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Square Credit Card Readers Make Payment Possible
The square credit card reader is becoming a popular trend in personal credit card processing, but it should be noted that the system is no substitute for merchant account processing that you may encounter with a regular business merchant account. The square system, and similar credit card readers that attach to smartphone headphone jacks, have their own method of payment acceptance and will charge a flat fee for every credit card swipe that goes through the system. If a card number is keyed in manually, the fee will be higher. The disadvantage of this method is that transactions over a certain amount, such as $1000, may not be paid to your bank account right away.
For an individual, waiting for a card amount to settle may or may not be a problem, but for a business, which may take in thousands of dollars in sales per day at a low overall margin, any crimp in cash flow could represent a problem. For individuals, the danger of fraud and chargebacks could also be an issue if an item such as an automobile were purchased using the square credit card reader. Sites like http://www.creditcardprocessingreviews.net can help you decide which merchant offers the best deals.
A brick-and-mortar business is also going to want to invest in credit card machines in order to batch transactions nightly, generate statements, and settle charges in bulk. Furthermore, the advantage to processing credit cards by way of an actual merchant account include the ability to accept debit cards, which have a far lower interchange fee, and get discounts on merchant processing fees based on the type of card used. At some point, it is possible that smartphone credit card processing equipment could substitute for credit card terminals and machines, but for business use it still makes sense to have terminals that print and have advanced features like contactless processing capabilities and printers so people can still sign a paper statement.
Notes and Special Information
Special note: This site speaks for all square-shaped credit cards and readers, not any particular brand. When choosing a source for credit card processing, you may want to consider whether you need a credit card machine, and if you will be considered to be an amateur (or a crook) if you break out a smartphone with a reader that looks like a toy and takes multiple attempts to authorize a card when you swipe it.