Entrepreneurs who sell products or services are faced with the decision of "to accept or not to accept" credit cards.
When mulling their choice, they often center on the costs associated with and revenues which may be generated by having a merchant services account to process credit card payments. But they may overlook the fact that merchant accounts actually improve the efficiency of their transactions.
The most noticeable effect that credit card payments have on a business is the increased speed at which commerce is conducted. In a retail setting, it usually takes less time for a cashier or clerk to authenticate and process a credit card transaction than it does for a customer to dig into their wallet or purse for cash or to fill out a personal check and produce valid identification. As a result, more transactions can be processed per hour, which can boost daily revenues for the business.
Improved Field Transactions
For entrepreneurs who accept payments away from their home office, a merchant account can enable them to process credit cards wirelessly. Within seconds, a card can be swiped through a mobile terminal or the data entered over a touch tone phone. This quick authentication process reduces the chance of payment fraud (as opposed to checks, which must be verified at the entrepreneur's base of operations or by a bank).
The more credit card payments that are accepted, the less cash that is sitting in a store's cash register. This in turn reduces the chances of money being lost or stolen. Also, funds from credit card transactions are deposited directly into an entrepreneur's bank account – so an employee doesn't need to make a trip to the bank to deposit cash or checks (and risk being the target of a robbery).
The more credit card payments that are accepted, the less opportunities there are for a business to fall victim to check forgery. Because computers and printing systems have become so advanced, check fraud has increased because of the difficulty associated with spotting a forged check. No entrepreneur relishes the notion of having to contact their bank and navigate through bureaucracies if they accidentally accept a forged check.
Every credit card payment is recorded electronically along with all the pertinent information regarding that transaction. In many cases, merchant accounts can be incorporated into a business's accounting and inventory software. This level of transactional detail is difficult if not impossible with cash and check transactions.
Many credit cards incorporate rewards programs which offer incentives to cardholders. So if customers use their cards at a given business, they can also earn "points" toward free or inexpensive merchandise, lodging, travel, and dining. This motivation factors into the buying decisions of consumers – which means they will look to spend their money at a place that accepts credit cards.
While profitability may be the most important aspect of a business, efficiency is not far behind. Entrepreneurs who obtain a merchant services account for credit card payment processing enjoy the advantages of transactions that are more rapid, versatile, and secure.