More than 3 billion people around the world own and use credit cards, with each person having at least 3 cards to their name. Without a doubt, credit cards are vital elements in every individual’s daily life, whether shopping for clothes or paying the bills How to start a credit card processing company . If you want your business to cover more ground and attract more clients or customers, then you should consider credit card processing. Technically speaking, credit card processing is a financial transaction that involves electronic access to the client’s account. Currently, there are four big names in credit cards and processing any one of them can help boost your business. First is Visa, with 261 million users as of last year. At 176 million strong is Mastercard. At the third spot is American Express, which is used by more than 50 million clients in the us alone.
Cash payment is good, but accepting credit card payments also has a lot of benefits. For one, it makes your company credible in the eyes of clients. If you accept cards, customers will think that your company is safe and reliable to deal with. Trust is a big aspect in business, and if a client trusts you, chances are he’ll make a purchase from your store.
From the little neighborhood deli to nationwide fast food chains to girl scouts selling cookies on the corner, it seems like everyone accepts credit cards now; in fact, it’s almost essential to accept credit or debit cards in order to keep up with the competition. But just because a lot of merchants accept them, it doesn’t necessarily mean it’s a simple thing to do. There are many credit card processing laws that merchants must follow in order to stay in compliance with their processing providers, as well as to keep their customers’ information secure. Read on to learn about the legal responsibilities of processing credit and debit cards.
When completing a transaction using a credit or debit card, a great deal of personal information must be obtained, including name (or business name), address, card number, pin number, etc. Unfortunately, just like a lot more businesses now accept credit cards, there are a lot more people out there trying to capitalize on this personal information, and identity theft has grown exponentially. Merchants have a great deal of responsibility to protect their customers’ information, and must take a great deal of precaution. Even when it seems like you are being cautious, identity thieves are developing new technology all the time to get a hold of the information they want.
Each and every business or merchant that accepts personal payment information from their customers are required to comply with credit card processing laws and regulations as well as institutional policies implemented by the issuers of most credit and debit cards and credit card machines. By following these laws in most cases you can fulfill your ethical duty of ensuring that your customers’ information is being used only in the way they want to be used, and that their financial security, privacy and confidentiality are protected.
In a recent March 16th Washington Post article by Michelle Singletary it was suggested that consumers respond to the Durbin Amendment in the Dodd-Frank Restoring American Financial Stability Act by “What if we just went back to using cash? Better yet, let’s all begin to negotiate more for a lower price on our purchases if we pay in cash. “
On the surface this makes perfect sense. Those horrible banks won’t be charging a penny for credit card processing interchange, the swipe fee on a merchant account. So because the merchant won’t pay their merchant account services fees – voila, we the consumer can negotiate a lower price and reap the “benefit! ” Regretfully, nothing could be further from the truth. The past decades of credit card processing growth were because it made it easier and quicker for us to purchase everyday items. Going back to cash entirely disregards this value proposition, both for us and the businesses we shop at.
Just think of our challenge today to obtain the cash. How is that money going to leap into our wallet? Certainly we can go into a branch, stand in line, and get cash from our accounts. Of course that’s a time consuming and frustrating task, especially if God forbid, we take out a lot of money and have to complete the government forms because you know, we’re still in the middle of a fruitless 50-year war on drugs. So no problem, I’ll just use the cash machine. And I can, for small amounts, but many times with lines. And I still need to drive to get to one. God forbid if i use a convenient Out of Network ATM Cash Machine! Then poof, on average I’ve just spent about $7 to $8 to get my cash! It’s not the desired outcome to pay more. And what about my personal safety issue? Won’t I be more exposed carrying larger amounts of cash? So i just won’t carry a large amount, right? Wrong! I’m not going to accept NOT being able to purchase something because I don’t have enough cash on me.