Should You Use Your Cell Phone For Credit Card Processing?

Technology has certainly changed the way in which business is conducted across the world; several exciting new innovations have made life easy for both the business owners as well as the customers. One such technological advancement is the ability to use your cell phone for credit card processing.

Mobile banking

Like with all other technological introductions, business owners have several questions about this technology as well such as how safe is credit card processing over the phone and can it really work for their business. In order to answer these and many other questions, it is essential to understand how credit card processing over the cell phone works and its pros and cons.

How Cell Phone Credit Card Processing Works

Many business owners who are not particularly tech savvy often wonder how it can be possible to process credit card payments through their cell phones. If you have used the big old credit card processing machine for accepting payments from your customers, you may already be familiar with how the process works.

The only difference over here is that you can connect your phone line to a smaller version of the machine and this will enable you to process your credit card orders using your cell phone. The credit card processing machines used for the process are not only small but also they are designed to work with smart phones making them truly efficient and convenient.

When you use the machine normally, you need to swipe the card through it and the customer authorizes the payment by signing a credit card receipt. In this process the client can authorize the payment by inserting his pin. You can also email the receipt or send it through a text message to the purchaser so that he has a record of the sale and the payment made. So, as you can see, apart from the telephone involved in the equation, the rest of the procedure is not very different from using a regular card swiping machine.

The Pros of Using Cell Phone Credit Card Processing

Regardless of what you are selling, if you are a businessman on the go, you may have often come across clients who are very keen on buying your services/products on the spot. However, a call back may not have gone down too well with the very same potential customer because he may have changed his mind about buying your product.

If the situation sounds familiar, cell phone credit card processing can make life easy for you because you will be able to make a sale and accept payment for it on the spot. So the most obvious benefit of using the technology is that you can make the sale and process credit card payments when the buyer is most interested in your products.

Also, using cell phone credit card processing means that you will not have to give your customers complex instructions on the different payment options that you provide or schedule a meeting with them in your office to make a sale. Cell phone credit card processing can prove particularly useful for people who do a lot of business while at trade shows, auctions and seminars etc.

The process is very secure, often more secure than traditional payment options. Since the transaction is encrypted, you do not have to worry about third parties accessing sensitive information about your clients and abusing it.

The entire process of validating the payment and the transfer of funds is completed within a few seconds eliminating the risks associated with traditional payment options. Cell phone credit card processing is a more portable option as compared to regular card processing machines, wireless terminals and even online payments.

The best part of using the technology is that you and your employees may already have a phone and cellular service that can be used to process credit card payments; this will greatly reduce the set up cost of using the technology. There are a lot of options to choose from when using cell phone credit card processing; not only does it work across a host of networks but also a myriad of cellular devices.

You can use your existing merchant account or online payment gateway to process credit card payments through cell phones. Even if you don’t already have a payment gateway in place, most cell phone credit card processing service providers will be happy to get you started with some preferred and recommended establishments.

Most companies offer competitive rates depending on your business volume for both keyed in and swiped payment transactions. You also integrate accounting software with the service that enables you to manage your payments online. It is also possible to provide your clients with text or email receipts confirming the sale and payment. Other features such as signature capturing and GPS location reporting are also available for certain providers.

The Cons of Using Cell Phone Credit Card Processing

One of the primary disadvantages of using cell phones for credit card processing is the risk of theft. If you are careless with your cell phone and card processing machine and lose it, anybody who knows to use the machine can make fraudulent charges on your customers’ cards and create a lot of trouble for you.

Another issue with the technology is the fee which is more than what you would have to pay to take orders through traditional means. Although with the introduction of several new services, the prices have certainly gone down; they are still higher than what you would end up paying regularly. Also, accepting payments through online payment gateways is not only less expensive than cell phone credit card processing but also it can be less cumbersome.

However, it is imperative to understand that through the use of this technology, you will be able to get a sale right then and there. Since there is no waiting involved in the process, you do not run the risk of losing your valued customers.

Another road block faced by many businessmen who use this technology is convincing their customers of the safety of cell phone credit card processing. Since the technology is fairly new, most customers are not acquainted with the concept and they may be apprehensive about using this procedure.

However it is not usually difficult to show them the benefits of this form of payment. Since you do not have to carry the credit card numbers of your customers for later processing, you greatly reduce the possibility of fraudulent activity on their cards through data theft. Also, your customers can get an instant confirmation of their order which can be quite convenient.

You will need to stress to your clients that not only is cell phone credit card processing more reliable than traditional means of accepting payment but also its safer because you do not actually have their personal information including their credit card number in a hard or soft copy format.

The Verdict

Using cell phone credit card processing is opening up new possibilities for businessmen across the world. They can accept payment from their clients safely and without too much hassle. As a matter of fact, most business people who have used the service have stated that it helped them to avoid the risk of fraud and they had no issues putting the orders through.

Not only is this technology the wave of the future but also it is particularly well suited for establishments that work with clients across borders and continents. So, you would be missing out on several key business opportunities which may have hitherto been unavailable to you, if you do not consider incorporating cell phone credit card processing as one of the payment options for your goods or services.

This is a guest post from Mirsad Hasic. Mirsad is the editor of best credit card deals (RSS feed), a consumer oriented site where you will also learn how to reach credit card debt relief.

Photo credit: Kakashi

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One Response to “Should You Use Your Cell Phone For Credit Card Processing?”

  1. Credit Cards |  Sep 30, 2010 at 2:44 pm

    I am not too sure if one should use cell phones for credit card payments,
    Yet to witness this revolution.