How a Merchant Account Improves Point of Sale Transactions

Some business owners are big fans of the “if it isn’t broken, don’t fix it” strategy when it comes to new ways of conducting business. They may adopt this mantra when considering whether or not to accept credit card payments. These individuals may believe that their current process of accepting only cash or checks for goods or services is sufficient because it has been working adequately for some time. What these business owners fail to realize is that obtaining a merchant account to process credit card payments not only could increase revenues by bringing in more customers, but also could improve the quality and efficiency of their point of sale transactions overall.

More Speed

Cash and check transactions generally take significantly longer to complete than do credit card transactions. Customers have to dig into their wallets or purses to pull out their cash or checkbooks. Then the checks have to be written or the money counted out. Then the proper change has to be counted and distributed or the appropriate identification has to be recorded for and verified checks. And other customers are waiting to be served while these delays are taking place.

With credit cards, all it takes is a quick swipe, an easy check of identification, a few seconds to authenticate the card, and a signature to complete the transaction. This results in a higher volume of transactions per day and a boost in revenue as a result. Perhaps more importantly, your potential customers do not associate your business with long lines or slow service – which would lead them to consider your competition.

Better Than Cash

In the past, Americans used cash to take care of most of their day-to-day monetary transactions and kept credit cards only for very large purchases. But these days, more and more people are putting daily purchases on their credit cards. This prevents them from having to carry large amounts of cash on their person and risk becoming targeted for violent crime. So giving people an opportunity to use credit cards keeps businesses in step with consumer buying habits.

Better Than Checks

There was a time when checks were the preferred method of payment among Americans. But the reason that check transactions fell out of favor was because businesses began refusing them. This was spurred by the high level of check fraud and forgery which was being reported by retailers and service providers. Today, with the sophistication of printing software, it is increasingly difficult to tell a fake check from a real one.

Businesses that happen to process false checks are forced to endure the hassle of contacting their bank and the bank which issued the check itself (if it exists) in an attempt to obtain the funds. With credit card transactions, authentication of the cardholder only takes a few seconds, and any disputed funds are handled largely between the credit card company and the consumer – without the business having to navigate a huge bureaucracy to get the funds it is due.

Rewards Programs

Many credit card companies offer extensive reward programs to their customers. The cardholders can receive points every time they use their credit cards, and these points can be redeemed for cash, airline miles, or reduced rates on hotels, electronics, and many other items or services. With this in mind, customers will actively seek ways to use their credit cards for more purchases. For example, when a customer buys a winter jacket, he or she may earn points toward the airfare needed for a ski trip. So it’s not surprising that credit cards’ rewards programs are taken into account by consumers when they are deciding which businesses to frequent.

Easier Field Transactions

For businesses which accept payments for services rendered at locations other than their home office, having a merchant account is a distinct advantage over competitors who do not accept credit cards. Merchant service providers can sell or lease equipment and/or software which enable company representatives to process credit card payments using a cell phone, laptop computer, or portable swipe terminal. The entire transaction takes about the same amount of time as it would in a traditional storefront establishment. This flexibility reduces the need for customers to write large checks or part with considerable sums of cash in order to pay for a service. Instead, these customers can spread the costs of the transaction over time if they pay for it using a revolving credit line offered by their credit card company. For the business, having a merchant account diminishes the risk of employees accepting fraudulent checks or carrying huge sums of cash on their person while away from the home office.

Better Security

Credit card transactions yield only a payment slip or an electronic record. This means that cashiers have less cash in their registers which can potentially be stolen or misplaced. Plus, funds from credit card transactions are deposited directly into the company bank account in a few days’ time, eliminating the need for a trip to the bank to deposit cash and checks. And business owners can take comfort in knowing that every credit card payment is recorded in detail – without having to piece together a transaction history from loose checks, a cash register tape, and a clerk’s memory.

In the business world, there is often much talk about perception and reality. When businesses acquire a merchant account, the reality is that their transactions will become faster, safer, and more efficient. But the perception of the business that will develop in the minds of its customers will be one of flexibility, convenience, and speed. Therefore, there are numerous reasons, both tangible and intangible, why getting a merchant account will help improve a business’s point-of-sale transactions.