Merchant Card Processors: Evaluating Card Processors

For a merchant to maximize its revenue, it may need equipment that processes debit and credit payment, such as retail, contactless, or wireless processors. Today, most in store and out of store purchases result from card transactions. Facilitating these transactions often requires debit and credit payment processors, also known as merchant card processors. Below, we profile four types of card processors regarding their advantages and disadvantages.

Retail card processors

Advantages. Stationed at in store points of sale (POS), retail card processors make it easy to accept card payment from a stream of in store customers. In addition, retail processing accounts currently have a lower discount rate than Internet, wireless, and mail order / telephone order (MOTO) accounts, which translates into more revenue per transaction.

Disadvantages. For businesses that conduct a low volume of low-ticket credit transactions in store, the setup fee, equipment fee, and account fees for a retail processing account can negate the value of having it. Standard retail card processors also involve the hassle of swiping and re-swiping cards.

Contactless card processors

Advantages. Contactless card terminals read contactless cards from a distance of three or more inches. In addition to being the fastest merchant card processors, contactless processors also eliminate card swiping. Research shows that contactless card users use their cards more frequently than traditional card users.

Disadvantages. Banks around the globe are promoting contactless credit cards. But the question is what percentage of customers in a merchant’s business region have contactless cards. If banks in your region have yet to embark on contactless credit card campaigns, buying a contactless card processor may amount to putting the cart before the horse.

Wireless processors

Advantages. Wireless card processors allow businesses to accept debit and credit payment at changing locations. Wireless processors also offer more transaction speed than touchtone processing, and wireless merchant accounts currently have a lower discount rate than Internet and MOTO accounts.

Disadvantages. Due to their wireless technology, wireless processors can cost significantly more than their wired counterparts. Wireless processing accounts also have a higher discount rate than retail processing accounts.

Using a cell phone as a touchtone processor

Advantages. Using a cell phone as a touchtone processor can eliminate equipment purchase, and a touchtone processing account usually has a low set up fee of under $40. As with wireless processing, touchtone processing allows merchants to accept payment at changing locations.

Disadvantages. Touchtone processing accounts currently have a higher discount rate than wireless accounts, and touchtone processing can take significantly longer than wireless processing. Due to their high discount rate, touchtone processing accounts are best for businesses that conduct a low volume of low-ticket transactions.

AVPS has the processing equipment you need

AVPS supplies merchant accounts and processing equipment that let you accept debit, credit, and check payment in various capacities. We have over 25 years experience in Small Business Merchant Accounts, and have serviced merchants for over 25 years. Whether you need wireless, retail, contactless, or online credit card processing, call us today for a free consultation.

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