How to accept credit card payments
Businesses and consumers increasingly use credit cards as a method of contactless payment especially in a post-pandemic world. Credit card payments are a convenient and secure way to make purchases, online or in-person.
How do credit card payments work?
A credit card is a payment card enables you to borrow money from a bank or credit card issuer to make purchases. When you use a credit card to buy something, you’re essentially taking out a short-term loan from the credit card company. You must pay back the borrowed amount and any interest charged by the company within a specified period.
Credit cards come with various benefits including rewards points, additional perks like travel insurance and cashback offers. However, credit cards may also have fees and interest charges. These all add up if you don’t pay your balance in full each month.
An individual or business typically needs to have a good credit score and steady income to apply for a credit card. If you’re approved for a credit card, you’ll receive a credit limit. A credit limit is the maximum amount you’re allowed to borrow on the card. Generally you’d receive a monthly statement outlining your credit card balance and any payments due.
What are the benefits of accepting credit card payments for a small business?
Accepting credit card payments can increase sales and revenue for your small business. Due to convenience and the ability to earn reward points, customers are more likely to make a purchase if they can use their credit card. Some of the most popular credit card types include Visa, Mastercard, and American Express (Amex).
Accepting credit card payments can also help improve small business cash flow as payments are processed faster than cheques. However, merchants usually need to pay credit card transaction fees to the credit card issuer for each transaction.
How to accept credit card payments for invoices
The best way to accept credit card payments is by including a payment link on your invoices to clients. With Bookipi Invoice app, your customers can make payment direct from the invoice. This helps you to get paid faster and improve your small business cash flow. Bookipi invoicing software integrates with one of the most widely used online payment processors, Stripe.
You can set up credit card payments in Bookipi Invoice software on web or mobile app in just a few steps. With Bookipi credit card payments, your customers click ‘pay now’ on your invoice. They will be taken to a secure payment page where they can enter their payment information.
Should I accept credit card payments through traditional card readers
Generally, traditional credit card reader devices are used for in-person transactions. Customers scan their credit card using your small business’ card reader and payment is processed on the spot. However, the main drawback is that credit card reads can be expensive to purchase or hire. There is also the risk that these costly card reader devices are lost, damaged or stolen.
What are the benefits of using invoice software that accepts card payments
Using invoicing software like Bookipi that accepts credit payments can provide a range of advantages including the following:
Faster payments – Customers can pay you instantly with credit card payments. This means no need to process checks or wait to arrange cash payment in person or for a bank transfer to come through. Online credit card payments help you get paid faster and improve cash flow for your small business.
Streamlined invoicing – Automated invoice payment tracking and payment reminders help you manage your small business’ accounts receivable.
Improved accuracy – Reduce errors in invoices with automated calculations in invoicing software. Lower the risk of payment disputes or delays because you’re confident that your invoices are accurate and complete.
Thorough record-keeping – Invoicing software with integrated card payments helps you keep track of your paid invoices in one spot. Being more organized prepares you for tax season. This is because you have clear records of your small business’ transactions.
Increased professionalism – Accepting credit card payments makes your business look more professional and established. Having this flexible payment option can build trust with your customers, as they know they are making payments through a secure platform.
How to choose the right payment option
When choosing a payment option for your business, a common mistake is deciding on a payment processing service based solely on cost. It’s important to find a payment service that fits within your budget. However, it’s also important to consider other factors like security.
Without proper consideration of other factors, you payment processing could end up costing you more in the long run if you experience fraudulent activity.
Factors to consider when choosing payment options as a small business
We’ve listed some useful factors to consider when choosing payment options for your small business below:
- Cost: Consider how fees associated with each payment method impacts your profitability. With Bookipi invoice app, you have the option to pass on credit card transaction fees to your customers.
- Security: Your chosen payment method should be secure and protects sensitive customer information.
- Ease of use: Choose a payment method that is easy for your customers to use. A complicated payment process may discourage them from making a purchase.
- Convenience: As a busy small business, you’re likely to value being reliably paid wherever you are. Using online credit card processing that integrates with invoicing software like Bookipi saves you a lot of time reconciling and chasing payments.
- Customer preferences – Another mistake that small businesses make is failing to offer multiple payment options. Customers may prefer to pay your invoices in different ways. These days, it’s important to offer a variety of payment options including contactless credit card payments.
Using invoicing software that accepts credit payments helps improve your billing process. You get faster payments, and improved record-keeping that means more time for you to focus on growing your business.
