Using bank cards in business

Most people and businesses expect to pay for products and services using bankcards. It’s quicker and easier, and saves people from the need to carry around physical cash. 

In 2014 credit and debit card payments accounted for 70%, or £170 billion, of spending in the retail sector. 

Aside from ease and speed, there are a range of other benefits for companies that accept bankcard payments:

  • it facilitates purchases over the phone or online
  • accepting card payments can open up new business opportunities for your company
  • card payments ensure flexibility and convenience for your customers
  • diversifying how a business can be paid can improve how a company controls its cash flow (waiting for cheques to arrive and clear can take time and cash needs to be paid into a bank account) and means a business can know exactly how much is in their account at any given time and payment is instant 
  • your company appears modern and up-to-date.

Setting up card payments to your business is a straightforward process:

  • first open a merchant account at your bank, then you will be able to process payments. You can use any bank for this so it is worth shopping around for a good deal
  • when you open a merchant account you will need to provide your business history, performance and financial forecasts. You will also have to tell the bank about your suppliers, the type of transactions you expect and the number of transactions you expect
  • after an account has been opened and set it up can take up to four weeks to go live
  • you can lease a card payment machine from your bank, it just needs to be connected to the phone. 

Making it work for you 

Some individuals and small business owners believe, incorrectly, accepting card payments will be expensive. 

This does not have to be the case and depends on the account you have opened, the likelihood of your company experiencing card fraud, and the amount of money transacted by card.  Bank charges vary according to the cards used. 

You will also be charged for every card payment this can be a matter of pence or up to 6% of the transaction. 

It is important to ensure that you comply with the PCI DSS (Payment Card Industry Data Security Standard). There are twelve requirements for any company looking to accept card payments.  Information about the requirements which include firewall to protect data, protection of stored cardholder data and restricting physical access to cardholder data can be found on the PCI DSS website. 

There are some risks associated with accepting card payments, including:

  • not spotting fake cards which may be used to defraud your business
  • poorly trained staff breaching data security, accepting fake cards,  and possibly leaving your company open to legal action
  • storing card data to charge later also leaves your company open to fraud liability and data loss this can result in major fines
  • refunding cash instead of the card can result from card returns being incorrectly processed and allowing customers to return items and get cash refunds. Stolen credit cards are frequently used for this. 

If your business is looking for advice on accepting card payments contact us today.

21 Lodge Lane
RM17 5RY

Tel: 01375 383888
Fax: 01375 391672