Mobile Credit Card Processing
When selling your art work online, accepting credit cards is no big deal: there are many popular and secure businesses like PayPal and Google who provide card processing for a fee. And it’s reasonably easy to set up a web site with the necessary links.
But if you travel to craft and art shows and sell your work in person, you need to be able to take credit cards. Enter the mobile credit card processing business. This requires an electronic card swiper provided by your bank or one bought aftermarket, and a cell phone so the swiper can communicate with the credit card verification company. But you also need an account at the verifier and a merchant account at a bank.
But now there is Square, the new kid on the block who is shaking things up in the credit card processing world. Square began a few years back when several of the developers behind Twitter (the incredibly popular micro-blogging platform) figured there had to be a better way to take credit cards via mobile phones. The idea was to make credit card transactions as simple and secure as possible for both the customer and the merchant.
And now, with their rate of growth over the last few years, Square is making the big banks nervous. Square doesn’t require a bank merchant account, a long signup process, a full credit check or much hardware to go with your mobile phone. Square does require a postage-stamp-size card reader that plugs into the audio jack of your iPhone or Android smart phone and the Square App, too. But that card reader and the Apps are free when you sign up with Square.
Opening an account at Square takes about ten minutes online at https://squareup.com . Signup requires a valid name and address and the last four digits of your social security number for identity verification with a credit agency.
Square charges a 2.75% fee per swipe for all cards, with the same rate for all major credit cards. And Square says they make a next-day automatic direct deposit to your bank account. Square is already easier than using a merchant account and an electronic swiper, but it’s also cheaper, too, if you do less than $10,000 in transactions a month. Over that amount, a regular card processor is a bit cheaper.
Square did about $2 billion in 800,000 transactions last year, mostly among small entrepreneurs. That means that many customers have never seen the tiny reader device and have never used their card on a mobile. If you use Square, it’s a good idea to bring some info from their web site with you. But you can assure customers that Square uses the same level of internet security as the other major card processors.
The Salvation Army has started using Square on the street to take their red kettle donations during the holiday season. You can read a New York Times article about Square and the Army at http://www.nytimes.com/2011/11/16/business/salvation-army-bell-ringers-accepting-mobile-payments.html