By Rob Olson
Anyone starting a business today needs all the revenue they can get. That means accepting money from clients or customers however they want to pay, which overwhelmingly is credit or debit cards. If you don’t take plastic, you may have trouble staying afloat.
But there is more to credit card processing – merchant services – than you might first suspect. Credit card fraud is rampant. Cybersecurity threats are growing. And you face new liability issues. What was already confusing is now more so.
Here is What Every Small Business Should Know About merchant services.
1) EMV – Chip compliance. The EMV or Euro MasterCard Visa AKA “The Chip”, is fast becoming required if you have physical contact with cards. Recent card brand, Visa/MC/AMEX/Discover, regulations have shifted fraud liability from the banks and institutions that issue the cards to you, the business owner. If you don’t accept the chip, you become responsible for fraudulent charges at your location.
Criminals are busy targeting merchants who still swipe cards, which are easy to defeat with a counterfeit card. You’re not off the hook just because you have a chip reader. You still need to check IDs to make sure the person matches the card.
2) PCI Compliance. Remember the security breach that shocked Target Corp.? Well, you’re now in the criminals’ sights. If they break into your network, laptop or file cabinet and grab credit card numbers, you could be liable for significant fines and a shattered business reputation. PCI-DSS (Payment Card Industry-Data Security Standards) now in place require you follow their rules for handling credit card information.
If you keep credit card information on site, it must be secure and you have to prove it by submitting to a quarterly network scan, implement a security plan in place and a complete an annual PCI Compliance questionnaire. If you don’t become certified annually, you will be fined monthly until you do.
3) It’s not always about price. I often meet business owners who use out-of-state merchant services companies because they got an amazing, too good to be true offer such as a guaranteed rate of 1%. Beware. That 1% is either a “teaser rate” that will go up after a couple of months or 1% over the actual price. They typically tie these super low, under cost rates to an expensive lease. Don’t fall for it.
Work with a local company you can trust that is within driving distance. Talk to someone who is willing to explain how rates work. In less than 30 minutes, I can get you up to speed. The more educated you are on pricing the better pricing you get, and the less likely you are to fall for the scams.
4) More than a cash register. Affordable Point of Sale (POS) systems are now much more than a cash register. For under $2,000.00, systems like Clover POS can keep track of payroll, daily profits, employee scheduling, text and email messages to your customer base. On the fly, you can change pricing and inventory from any device, anywhere in the world.