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How to Accept Credit Card Payments

Austin Chegini
24 May 2021

Wired reports that fewer people are paying with cash these days. To keep up with this trend, businesses need to accept other payment methods.

But how does one accept credit card payments? 

Let’s see an overview of how credit card processing works and how businesses can accept these payments. 

The basics of payment processing 

When a customer swipes a credit card, it may appear like a simple transaction. Money goes from their bank to the business’s bank, correct? Well, it’s not that simple. 

In a normal transaction, multiple parties work together to transfer the funds to the merchant. This process typically looks as follows:

  1. The cardholder inserts their credit card into a terminal, often provided by the payment processor.
  2. The payment processor checks with the credit card company and cardholder’s bank to ensure the card is authentic and the account has sufficient funds.
  3. The bank approves the transaction, and the terminal will print/display a success message. 
  4. The payment processor sends the funds to the merchant’s account. 
  5. The funds will take 1-3 business days to clear before the merchant can access them. 

Although this process seems simple, it does require sending data back and forth between parties. Most importantly, it requires the merchant to have an account to collect the digital funds. A traditional business bank account will not do. 

Instead, a business will need a merchant account. This account will hold the credit and debit payments until the charges clear. Then, the business can deposit the funds into their normal bank account. 

You can obtain a merchant account independently, but then you will also need to coordinate which card companies you’ll accept and negotiate on rates. To make things easier, you can work with a payment processor that already has relationships with banks and will settle the funds for you. 

How does a business accept credit cards?

As mentioned above, business owners will need a few key items to accept credit and debit cards. 

For in-store purchases, you need:

  • A payment processing company
  • A card terminal
  • A point of sale system

For online purchases, you need:

  • An e-commerce website
  • A payment gateway

Accepting credit cards in store

First, you will need to set up a point of sale system. This device will track all your sales, manage your inventory, and execute several other core business functions. 

As you ring up a customer, you will scan the barcode or enter the product price into your EPOS system. If they pay with a credit card, your EPOS will communicate the total price due to your credit card terminal. The customer will insert their credit card, and the process listed above will commence. Once payment is verified, the EPOS will confirm the transaction and print the receipt. 

You can obtain a credit card terminal from a payment processing company. These companies not only supply the hardware to accept credit cards, but they will also facilitate the entire transaction for you. 

In return for taking care of this process, the companies charge a small fee, which typically falls between 1-3 % of the total transaction price. These transaction fees can be a flat rate or variable, depending on your credit card processor.

Accepting credit cards online

If you have an e-commerce website, you have a few ways to accept credit cards. In most cases, you will use an e-commerce platform like Shopify or BigCommerce to build your website. Through these services, you can choose from various payment gateways to accept credit cards. These services are already partnered with the platform, so registering for an account and taking payments only takes a few clicks.

If you build the website through a traditional web builder like WordPress, you will need to find the payment gateway on your own. There are a few ways to set up these gateways, but using plugins is the easiest option. 

For example, you can set up a Stripe account and then use the Stripe plugin to accept credit cards. Likewise, you can use the WooCommerce plugin to build an online store and use its built-in payments section to accept credit and debit cards.

Start accepting credit cards with Epos Now

Epos Now point of sale systems integrate with payment processing companies throughout the world, so you can accept all major credit cards. On top of this, our integrated payment technology allows you to accept contactless payments like Apple Pay and Google Pay. 

If you have a physical and online store, Epos Now makes it easy to link each store’s inventory. When items sell online or in-person, the other store will automatically update the stock levels so customers are never confused. You simply need to set up your payment gateway, and you can see all online and in-store sales on your EPOS. 

Contact Epos Now today to learn more about our payment processing options. 

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