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Virtual Point of Sale (VPOS)
- Useful when you are processing payments that are coming in by phone, fax or email
- Make sure that you have a mechanism to reconcile VPOS payments to bank deposits
A virtual point of sale application (VPOS) is a replacement for traditional hardware-based POS terminals that you may be familiar with at restaurants, bars and other places where credit cards are accepted. The application is either installed on your PC, or is accessed through a secure web connection (much like an online order form). VPOS lets you authorize, settle, credit and delete transactions, and may perform other functions such as reporting.
4VPOS is used by businesses that want to process payments that arrive by phone, fax or email, such as call centres and mail order businesses.
Wireless
- Useful when you are processing payments in remote locations (e.g. pizza delivery, flea markets, etc.)
- Make sure that your data transmission is secure. The wireless connection should be digital to protect data.
Many wireless devices are emerging now to satisfy the needs of mobile workers. Digital cell phones, Personal Digital Assistants (PDA’s, such as Palm Pilots) and specialized hardware can now be used as mobile payment devices. With a “WAP-enabled” cell phone or browser-based PDA, you can enter the basic information required to process a transaction.
Wireless payment processing is useful in situations where traditional or PC-based point of sale devices cannot be used.
Swipe Card
- Useful when the customer is present and when you need to give the customer a signed receipt for their payment
- Make sure that your merchant account is configured to take advantage of the lower discount rate (i.e. credit card fee)
Swipe card applications are ones where the credit card can be “swiped” through a card reader, and the customer can sign the receipt. The swipe device can typically be connected to a PC, or specialized devices are available for use (such as traditional POS terminals).
The merchant account fees for swiped (“card present”) transactions are lower than “card not present” transactions.
2. Get a Merchant Account
A merchant account gives merchants the right to accept credit cards for payment. A merchant account is required for each credit card you wish to accept. This step can be the most time-consuming and frustrating for merchants, and it will also be the component that most influences your costs of doing business online. Researching your merchant account options, understanding the merchant account process, knowing how merchant account providers assess merchants, and “shopping around”, will pay off dramatically.
Merchant accounts have several fees associated with them, including a set-up fee ($200-$500), monthly statement fees ($5-$10), a monthly minimum fee ($20-$30) and a discount rate. The discount rate is a percentage of your sales revenue that the banks levy, and it varies by how “risky” your business is perceived to be (many factors enter into this, such as your credit history, the type of products you sell, your sales volume, average order size, etc.).
When enquiring about merchant accounts, start with your bank first. Then shop around. Fees vary significantly from institution to institution. In fact, they sometimes vary within an institution, depending upon the merchant account representative you speak with. Depending upon your sales volume, shopping around can save you a lot of money over time. If you wish, TransActive has relationships with several merchant account providers, some of which have online applications that are available online on TransActive’s website. We’d also be happy to advise as you work through the process of obtaining a merchant account.
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