It has become a popular trend to bestow the cashier with a credit card rather than cash while purchasing an item nowadays. Many customers come with the mindset that their cards will be accepted and they won’t have to keep crunched up notes to pay the bill. It can be seen that there is a growing demand for card readers and accepting credit/debit cards as a method of payment.
This might come out to be a problem for small and medium-sized business owners. Due to the dependency on conventional form of payment like cash, these businessmen may end up finding themselves at a standstill and no further growth. Why so? Well in the given case scenario that credit cards are preferred by the buyers and merchants do not possess a card reader, they might end up losing a customer.
Small and medium-sized business owners should adapt to the changing circumstances as this will only help increase their revenue stream. Businessmen should not hesitate to implement card reader technology, even if paying the transaction charges might seem to be a burden. EMV card reader is easy to get your hands on, companies like SumUp provide small and medium-sized business owners with advanced credit card terminals that permit merchants to easily accept payments anywhere.
Before it became a trend, card readers and other credit card terminals were expensive for these businessmen. But with the vision of becoming the world’s first globally accepted card brand SumUp has bridged the differences that were there for these small and medium businesses. The company provides with card readers that can read magnetic stripe, EVM chip, and NFC enabled cards.
SumUp has branched its way through the markets of the United States of America about a year ago. After the massive success in Europe and South America, the company plans on marking its presence in the American markets and has even set up an office located in Boulder, Colorado.
If you do decide to take up card payments as a method of transaction for your business, there are a few things you should keep in mind:
Technology: As card readers have been available for over a while, it is recommended to facilitate the newest of all technology.
- Stripe card readers though convenient are a bit out of fashion. These card readers work as such; the card which has a magnetic stripe on it will be swiped along a physical terminal after which the payment will be made. This method of payment can be replicated and used by a fraudster to make a payment. This card reader will soon phase out of the market.
- EMV card reader is a more advanced way to accept payment. “Europay MasterCard Visa” is what EMV stands for and is the most globally accepted form of payment. EMV card reader works on the principle of chip technology, each card has an encrypted chip placed on it. This chip when read by the card reader will grant the merchant access to the payment. EMV technology can be used on all the modern terminals.
- NFC card reader is another sort of modern card reader, with almost the same level of safety and principle as that of EMV technology. NFC stands for “Near Field Communication”, in this type of card payment all those cards that are equipped with NFC technology, smartphones or other smart devices that use RFID are eligible for making transactions. With the concept of less-contact, users who possess NFC enabled cards can transfer money with a simple tap on an NFC based terminal. This payment method is taking the market by storm.
**Fraud in the case of EMV or NFC based cards are only present in the case of card-not-present transaction takes place; online payments or over the phone billings.
Credit Card processing fee: Credit card companies tend to charge hefty fees in the name of transaction charges which may come to be a problem for small and medium-sized businessmen. As it becomes heavy on the pocket, it’s advisable to have a tie-up with a company with low transaction charges. SumUp is one such company with transaction charges as low as 2.65%
Payout: Many credit card companies take an awful amount of time to pay you the money that is already yours. Why go through such a hassle? Companies like SumUp tend to give out direct payouts after each transaction.
Now that you are aware of the type of card readers and what to choose, you should now pay attention to a vital aspect of card payments, “liability”.
In October 2015, a liability shift had been declared. Which stated that “In the case of in-store counterfeit fraud the liability- the buyer or the authorized merchant- would shift to the party which did not possess chip technology.“
It is pretty crucial that you understand this liability shift as it will help you bloom your business in the future. We have briefly mentioned it down below.
- If a counterfeit payment is made using a magnetic stripe card on a stripe card reader, then the liability shifts to the customer. As conventional rules, but there are chances that the merchant might be held responsible it is highly unlikely though.
- If a counterfeit payment is made using a chip encrypted card on a stripe card reader, then the liability shifts to the merchant.
- If a counterfeit payment is made using a chip encrypted card on a chip based card reader, then the liability again shifts to the customer.
From the above, you could see that in the case where chip technology was involved was not held liable. In the case where both parties had invested in chip technology, the customer was held responsible due to conventional rules.
It should be noted that the liability shift does not occur in the card-not-present scenario and lost or stolen fraud. In such cases, the liability remains subject to existing liability and chargeback rules.
Hence it is beneficial for both merchants and customers to invest in chip technology, as it will help grant secure transactions as well as easiness in processing payments.