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Payments On the Go – Turning Your Mobile Device Into a Cash Register

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Payments On the Go – Turning Your Mobile Device Into a Cash Register

By Caron_Beesley, Contributor
Published: July 2, 2012

Have you considered dispensing with your cash register or offering more flexible payment options for your customers?

If you’ve ever purchased anything from an Apple store, you’ll recall that they don’t have a single cash register on the premises. Instead, all payment transactions are conducted by Apple’s employees using mobile devices.

But Apple isn’t the only one in on the act. More and more small business owners are turning to mobile payment platforms on site and on the road. And with smartphone use at an all-time high, new technology is making it much easier for small business owners to process credit card payments via smartphones and tablets.

For local businesses, particularly those that sell products on the go – at fairs, in restaurants, concession stands, and door-to-door – these payment solutions offer small businesses reliable options for accepting payments other than checks and cash.

When it comes to accepting payments via mobile devices, the following platforms are particularly geared towards small local businesses:

1. “Square”

Used in more than 20,000 retail locations nationwide and processing more than $5 billion transactions per year, the market pioneer and current leader is Square.

How it works: Square is a very simple concept. Using a free app and card reader (or dongle) that plugs into an iPhone, iPad or Android device, businesses and their employees can collect payments by swiping cards through the device. Once accepted, the customer signs the touch screen with either their finger or a stylus, and can add a tip. A receipt is sent to the customer via text or email. The cost? Square charges merchants a 2.75 percent fee per swipe for most major credit cards and funds are deposited the next day.

Note that if you accept more than $1,000 in card-not-present payments during any seven-day period, Square will defer depositing the amount in excess of $1,000 for 30 days (more here). Square also offers Square Register, which can convert any iPad into an all-in-one cash register.

2. Intuit GoPayment

Intuit GoPayment is similar in concept to Square. Merchants get a free app and card reader that can be plugged into a smartphone or tablet device. It also synchronizes with QuickBooks, making it easy to manage your sales records; you can also buy add-ons that allow you to print receipts. Intuit’s pricing model is also slightly different than Square’s, with two options: 1) A 2.7 percent fee per-swipe (3.7 percent for keyed transactions), or 2) merchants can pay a monthly fee and pay a lower per-swipe rate, maybe a better option, depending on how you use the reader.

3. PayPal Here

Launched earlier this year, PayPal Here includes a free credit card reader and app, as well as a range of add-ons. For example, merchants can use their device’s camera to scan checks and cards (useful if you don’t have your card reader on you), as well as access their own PayPal account to make purchases. PayPal Here charges slightly less per swipe than its competitors at 2.7 percent. It also purports to be more secure, thanks to card reader technology that encrypts cardholder information before it is transmitted to the device.

The Bottom Line

This is just a brief overview of some of the players. A quick search online will deliver a host of reviews that can help you make an informed decisions about which platform makes sense for your needs. It’s also a good idea to talk to other business owners to gauge their experience of these platforms. The SBA Community Discussion Boards are a great place to start.

Talk to your accountant, too, so you have a clear view of how a mobile payment platform will fit into your cash flow management processes.

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About the Author:

Caron Beesley

Contributor

Caron Beesley is a small business owner, a writer, and marketing communications consultant. Caron works with the SBA.gov team to promote essential government resources that help entrepreneurs and small business owners start-up, grow and succeed. Follow Caron on Twitter: @caronbeesley

Comments:

Great. I am also implementing a mobile POS system for our retail store. It's really a new retail purchase experience.
Hello, Nice post. Thanks to sharing this valuable information. Mobile payment solutions is only recently that the technology to support such systems has become widely available. https://postee.co.uk/
This area is a chicken and egg game between consumer adoption and merchant adoption. As a merchant, the industry needs to clarify who controls the customer data and the payment standards need to stop shifting.
I have used regular bank merchant accounts, paynet, cynergy, amazon, google, I have used them all! I now use square and I can't even begin to describe how much better, easier to use, the lightning fast deposits, the smartphone app, the package is second to none. If you have an Ipad you can even integrate a store.
The golden time for retailer to make an investment and have the best possible outcome for this...They has bee working on this and hopefully they would be serving all of us with there latest invention... This post was edited to remove a link. Please review our Community Best Practices for more information about how best to participate in our online discussions. Thank you.
This is a very exciting time for retailers to take advantage of new technology - from mobile devices to cloud computing. Paladin Logic has just completed initial development of a mobile retail system that includes both a mobile point of sale device and a cloud-based back end ERP solution that handles all business information. We are looking for a small group of retailers who would be interested in helping refine the system.
Square sounded really good for my new business, so I got it. I didn't realize that there is no way to speak to a live person. You can only contact them by email. I first used Square on February 19, 2013, and had no refunds, charge backs or other issues. As my business is growing steadily, I applied for an increase to the keyed in limit for transactions on August 1, 2013. On August 02, 2013 I was informed that my account had been judged to be “high risk” and my account had been closed. In addition, they were going to hold my transaction of $1060.94 for 90 days. I accept that they have the right to terminate for any or no reason as that is in the user agreement. However, I do NOT accept that they can hold my money for 90 days without prior notice. There is nothing in the user agreement that mentions a holding period of 90 days for ANY reason, I have never had a refund, dispute or chargeback and this was a repeat customer that charged with them many times. The BBB was no help. Square sent them the same generic email that they sent me twice and the case was closed. If you are considering using Square do yourself a favor and visit this website where over 1,000 people have reported similar problems. I sure wish I had. http://www.cardpaymentoptions.com/credit-card-processors/square-review/#respond

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