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Merchant Services

Discussion in 'Small Business' started by Aaronjod, 1st Sep, 2015.

  1. Aaronjod

    Aaronjod Well-Known Member

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    Hello fellow PCers!

    In the process of setting up a new business. Will post a thread about it when I've started it, but in the meantime I'm after some advice on merchant services.

    I want customers to be able to pay via credit card if they want. What is the most cost effective way to be able to take credit card over the phone? It will be a mobile service so typically I would meet up with a customer, and if they wish to proceed they will put down a deposit. From there I will provide my service and they will pay the shortfall upon completion. I realise funds transfer is a cheap option but I want to be able to have confidence to proceed upon receiving payment straight away via CC. My initial turnover would be quite a small amount <-1-2K a month, but hopefully it grows as does the business.

    Every place I have worked has had an EFTPOS machine to take CC, but can you do it online without the machine?

    Thanks,
    Aaron
     
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  2. Kinnon Bell

    Kinnon Bell Finance Broker

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    I went to a lunch held by CBA the other day and they were showing off their new merchant terminals where they have several different mobile versions depending on the need ie mobile phone size, tablet version, print receipt or not. Works off sim card or wifi IIRC - thought it was pretty handy for the likes of tradies and service providers so they don't have to chase payments.

    I know nab has been working on one too but not too sure if it's come to market yet.
     
  3. geoffw

    geoffw Moderator Staff Member

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    I don't know on the credit card side- but have you looked into accepting Paypal? It can be very easy to set up.
     
  4. Samten

    Samten Well-Known Member

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    You need to talk to your bank first as there are different requirements for taking cc,s online, over the phone and eftpos. Also there are some mobile apps that can be used with your mobile.
     
  5. Simon Hampel

    Simon Hampel Founder Staff Member

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    eWay have been pushing their SmartPOS system a lot lately - https://www.eway.com.au/smartpos

    I've not used it myself and it does seem to aimed at people who use Xero + Shopify + Salesforce (although I don't think these are requirements), but it looks interesting.

    Not sure how costs compare to other systems.

    For general internet merchant services, I do recommend eWay - so their backend stuff for this system would be good, but I don't know how robust their POS solution is.
     
  6. Aaronjod

    Aaronjod Well-Known Member

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    Thanks. The eWay system looks great, and their pricing seems fair. I will see what my bank can offer (CBA) and decide between them & eWay.
     
  7. chylld

    chylld Well-Known Member

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    I've set up EFTPOS terminals throughout my company (a few dozen sites across Australia) and we've had moderate success with DPS / Payment Express. Their terminals are IP-based so they can work off any Internet-enabled laptop (don't require a landline). Their support can be lacking at times so we are now looking into SimplePay.

    A mobile phone based solution might suit your business better (by the sounds of it) but be careful of merchant rates which can be quite high (esp Paypal). They are high because of Interchange Plus, the scheme that passes on the various levels of credit card fees to the merchant. Merchant can choose to either absorb the fees or pass them on to the customer (which I'm sure everyone has seen.)

    If you've ever been curious why banks give out gold/platinum/black cards like free candy, you're about to find out as a card-accepting merchant :mad: (unless your business is in an exempt category in which case it's a flat rate)
     
  8. Simon Hampel

    Simon Hampel Founder Staff Member

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    Yup, if you read eWay's fine print on their new all-in-one merchant facility (which has a great "headline" rate), you'll notice that they explicitly exclude premium and foreign cards - which generally attract a 3.2% fee. That's still less than what you'll pay with a bank merchant facility though - I've been charged up to 3.9% for card transactions in the past!

    I got caught out by this when I first set up my merchant facility when one of my clients paid a $10K consulting invoice using their platinum VISA card - cost me something like $375 or so, or over 3 hours worth of billable work!

    I questioned my bank over this and they said that their online merchant facility can supposedly do differentiated surcharging based on card-type (so premium card can be surcharged more than non-premium cards), but I've never seen any documentation about this to support the claim, not do I use their merchant facility directly because it is too expensive and their gateway API not as good as that offered by other systems such as eWay.

    I don't know how that would work anyway - you generally need to tell the customer how much the surcharge is going to be BEFORE you take their credit card details - and if you're doing an online transaction you have no way of telling what type of card it is before you take their details - and by the time you have their card details to check, it's generally too late to decide to charge them more.
     
  9. chylld

    chylld Well-Known Member

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    3.9% is nuts!!

    Oh well, fees aside, find the best deal and be ready to take credit card payments on the spot. Looks professional to the client and prevents the customer from umming and ahhing while they hold an invoice with your direct deposit details on it.
     
  10. wobbycarly

    wobbycarly Well-Known Member

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  11. Simon Hampel

    Simon Hampel Founder Staff Member

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    That's a bit of a risk when dealing with "unknown" customers I think - too high a risk of fraud. Although I guess if you physically have the card, that's pretty much as good as swiping or tapping it anyway.

    My merchant facility allows me to manually enter credit card transactions into the online management portal - which I do frequently when charging my clients (but we're talking about a small number of people who I know well with virtually zero risk of chargebacks).
     
  12. Azazel

    Azazel Well-Known Member

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    Hey Aaron, good for you!
    Hope it all goes well, looking forward to hearing the details when you're set up.
     
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  13. wobbycarly

    wobbycarly Well-Known Member

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    And FWIW, we use eWay at work (10's of thousand of transactions a year) and it is nicely integrated with our website (Magento), including refunds/returns. Hoping to give the OP a few options.
     
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  14. leon brown

    leon brown Active Member

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    after some advice from Sim and Samten I too am going with Eway for my internet start up
    found the banks Commweb way to expensive
     
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  15. Aaronjod

    Aaronjod Well-Known Member

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    Eeek, damn pricey @Simon Hampel! Thanks for the heads up about the platinum card. I literally received one in the mail and couldn't work out why. I discarded it, because I saw no need. The real reason was the card number was different and I didn't want to re-enter it into PayPal when I do online purchases :D

    Part of the reason eWay sounds good is because I am going to be using Xero too.

    Just to confirm with you guys who have used them before;

    EFTPOS = 30c a transaction (eWay) but the minute a customer pulls a credit card and selects credit is when the fee is incurred?
    How about a visa debit & they select savings?
    Would that be classed as a EFTPOS transaction?

    @Azazel I promise it isn't AMWAY. :p Will keep you posted. Should be around a month & I will be launching it.
     
  16. chylld

    chylld Well-Known Member

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    Yes as soon as they press the credit button the whole transaction is sent to the gateway. If the transaction fails after this point (e.g. incorrect PIN) the terminal will send a cancel transaction to the gateway. Hopefully it won't happen to you but sometimes the cancel transaction gets lost, you think the transaction is cancelled but it's gone through and the customer is charged anyway (or double-charged if you tried again.)

    If they select savings then it is priced according to your EFTPOS/debit card pricing which is usually a flat fee (30c in your case it sounds like).
     
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  17. charpj

    charpj Well-Known Member

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    Through my terminal experiences, when a customer uses a tap and go style function that will default as a credit card visa % charge, if you stick the card in it will be charged via EFT amount.

    If your clients will be using Union Pay cards (there is a series of issues, with Chinese banks etc) best to use is NAB terminals