4/30/2023 0 Comments Square procssorSquare is an online payments company, like PayPal, and thus does not offer the same services and support you get with a full-featured payment processor. It’s important to know that Square is not a traditional payment processor. It may be only a few tenths of a point per transaction, but Square’s higher rates end up costing you a lot of money over the long run. So while Square’s flat rates might be appealing in their simplicity, unless you’re running just a few transactions a month you’ll find that using a traditional payment processor will save you considerable money, thanks to the lower variable-rate fees. (This is the rate charged by the credit card companies and issuing banks.) Variable interchange-based fees are typically much lower than the flat fee charged by Square. A convential payment processor charges each transaction at its actual rate, based on what the industry calls the interchange rate. The first problem many businesses have with Square concerns those flat rates, which are extremely high.The flat rate sounds nice but hides that fact that different types of credit and debit cards are charged different rates – many of them much lower than what Square charges.Ĭompare Square’s rates to merchant accounts through a traditional payment processor. Square charges 2.75% per transaction for in-person charges, 2.9% + 30 cents for each eCommerce transaction, and $3.5 + 15 cents for each keyed-in transaction.Īll of this makes Square an appealing choice for many businesses, especially those just starting out, that do a lot of online transactions, and that handle occasional credit card payments. In addition, Square offers a simple, easy-to-understand flat rate fee structure. The Square Reader works with Square’s mobile app (which you download to your device) and essentially turns your phone or tablet into a mobile credit/debit card terminal. Just purchase a small Square Reader card swiping device and connect it your mobile phone or tablet via Bluetooth. With Square you don’t need a fancy credit card terminal you can process transactions from any tablet or mobile phone. Square is especially appealing to online and mobile businesses. If your business is new or doesn’t have a long history, getting started with Square might make sense. In essence, Square processes one transaction at a time, rather than establishing a long-term relationship with its customers. There are no long forms to fill out, no credit checks required, and no monthly minimums to meet. Square promises a quick and easy solution for accepting credit card payments, and in some ways it delivers.įirst, Square does make it easy for virtually any business or individual to sign up for payment processing. There are many things about Square that some businesses find appealing. While Square might be a good solution for some businesses, it falls short in many ways, which we’ll examine. Square aggressively courts new and small businesses, and many individuals and companies use Square for their credit card processing. If you’re looking for a way to accept credit card payments, chances are you’ve heard of or looked at Square.
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