Best 2022 Guide to Credit Card Processing for Nonprofits

Credit Card Processing for Nonprofits

Best 2022 Guide to Credit Card Processing for Nonprofits

Many organizations want to accept credit card donations or payments for fundraising auctions online but don't know how. You can accept payments online in one of two ways: through a nonprofit credit card processing service, or by opening your own merchant account. 

Why Nonprofits Need Reliable Payment Processing

Nonprofit and charitable organizations rely on monetary donations from their supporters to further their missions. While a nonprofit organization could theoretically rely on cash and paper checks for donations, much like a retail operation, this strategy would drastically limit the amount of money it will receive. The ability to accept non-cash donations is crucial. 

The Federal Reserve Bank of San Francisco found in its 2021 Findings from the Diary of Consumer Payment Choice that cash use accounted for 19 percent of all payments. With the use of cash dwindling as a payment preference, debit and credit cards and ACH take over as the predominant payment methods. In recent years, consumer spending habits have drastically changed--primarily moving from in-person to online. If a nonprofit organization is unable to accept credit or debit card transactions or ACH transactions, it severely restricts its fundraising potential, and by extension, its ability to carry out its mission to their nonprofit clients. 

There are a number of benefits that accompany utilizing a payment processor and donation button with an online donation form on your website, namely an increased opportunity to accept larger donations and monetary gifts and the ability to attract more potential donors--even international donations. Just like for-profit businesses, every nonprofit can also benefit from a reliable payment processing system to accept online transactions and credit card payments.  

Common Terms to Understand When Considering a System for Online Payments

Before exploring payment processing and credit card donations, it will be helpful to understand common terms associated with collecting online donations and credit card processors. 

A credit card payment processor allows nonprofit organizations to process credit card transactions online. The processing company then takes a small percentage of each transaction as compensation for its services. A number of credit card processing providers exist; be sure to inquire if they offer specific rates for nonprofits or offer nonprofit discounts. 

A merchant account is an account that you open with a bank to accept credit card payments. In addition to online payments, if an organization wants to accept offline donations via credit cards, a merchant account is used alongside a hand-held credit card reader.  

A card association is a group of banks that sets the terms for all credit card transactions. Some examples are credit card companies Visa, Mastercard and American Express. 

ACH debit payments allow donors to give directly from their bank account. This is done by using an e-check, which is a payment that goes through the automated clearing house (ACH). 

A third-party processor is a provider that allows a business to accept payments without opening its own merchant account. Typically, nonprofits that expect a low volume of transactions may want a third-party processor. 

A payment gateway is technology that securely captures and encrypts sensitive credit card details from a donor and transmits that data to a payment processor to complete a transaction.  

A payment aggregator is a third-party payment provider that uses one large merchant account to process payments for smaller businesses and donations for nonprofits. 

How does a Merchant Account work?

After a nonprofit has secured a merchant account, it can accept card payments. It starts when a donor elects to give. They amount they select is relayed from the card processor to the credit card network (such as Visa or MasterCard). The credit card network then readies the transaction to the issuing bank, which then approves the transaction and allows funds to be sent to the merchant account. From there, the nonprofit can transfer the funds from their merchant account to its bank account. The entire process typically takes a few business days or up to a few weeks to complete the transaction.  

A nonprofit should always compare merchant account providers, particularly for pricing.  

How does a credit card processing service work?

Similar to how a merchant account works, it all begins when someone chooses to give a monetary gift. The donor begins the process by using an electronic device, a computer, smartphone or tablet. This triggers the payment processor to send the transaction through a payment gateway which verifies the validity of the card and checks if the donor is a human (not a robot) and the card is not fraudulent. When verified, from there, the payment gateway begins the transfer of funds, and the credit card company sends the donation to the merchant account. A nonprofit can later retrieve it's funds from the merchant account. 

What type of payments should my nonprofit accept?

Most nonprofits organizations accept a variety of donation types. To maximize the potential for donations, nonprofits are encouraged to accept a number of payment options in addition to cash and checks: 

Payments by Card: These donations include those made via credit card or debit card. Be sure to consider if your nonprofit will accept all major credit cards (Visa, MasterCard, Discover and American Express) or only some. Keep in mind, fees will vary based on the type of credit card. 

ACH Debit payments: Payments made via ACH debit are particularly useful for donors who want to set-up recurring donations. Donors must submit their bank account and routing numbers so funds can be directly transferred from their bank account to a nonprofits bank account. In addition to the ease and convenience of setting up recurring donations, ACH debits also allow nonprofits to avoid the credit card processing fees that typically accompany card payments. A payment processor may only charge a flat fee for an ACH debit. 

Additional Tools & Features of Online Payment Processors for Nonprofits

Before exploring your processor options, it will be helpful to know what features you need from a card processor. Consider the ways you primarily hope to accept donations, for example at in-person fundraisers and events, online or through memberships. Know your budget as well as the anticipated volume of donations your nonprofit expects to receive on a monthly basis.   

The number one reason that motivates charitable organizations to seek a payment processing company is to give their donors payment options--the ability to donate via major credit cards, debit card and ACH payment type. Beyond acting as a credit card processor and online donation tool, an online payment processing system also offers a number of other valuable features: 

Accept Donations Online: With a reliable payment processor, it’s easier than ever before to accept donations online right on your website. With a "donate now" option on your website, you can easily collect immediate payments from anyone who wants to support your organization. 

Set-up Recurring Donations: Setting up recurring payments usually involves using an automated payment system through banks. Nonprofits can use payment processing services to accept regular donations via direct deposit (also called ACH) instead of credit cards. A recurring donation feature can turn one-time or annual donations into ongoing, repeat gifts and impact donor retention rates. 

Ecommerce: If your non-profit sells items online to support its cause, such as t-shirts or mugs, payment processors may be able to help you create an online store. 

Sell tickets for nonprofit events: Event ticketing platforms allow non-profits to more easily sell event tickets and track event registration, enabling eventgoers to buy them right away when they're announced online. 

Collect membership fees: For nonprofits who rely on memberships to fuel their missions, online payment processors can seamlessly facilitate collecting membership fees. 

Other Mobile Giving Options: Your nonprofit may also want to look into text-to-give donations and other mobile giving options, particularly if you want to appeal to or expand to a younger donor base. The goal is to make giving as easy as possible. 

If donors can do all of these things from the convenience of their personal electronic devices, they’ll be more likely to follow through with their donations and will positively affect donor retention rates. 

With a thorough understanding of your nonprofits needs, you're ready to compare options. 

How to Choose the Best Payment Processor for a Nonprofit

There are a number of online payment processing options, but which are best designed for nonprofits to accept various types of donations? Each comes with its own set of pros and cons that you’ll want to carefully consider as they relate to your organization. 

Most, if not all charitable organizations are challenged to keep costs low so it's important to identify an affordable payment processor. Be sure to investigate various fees, including platform fee, transaction fees, and termination fees, and to explore a nonprofit discount. In addition to cost, ease of use and customer service should also be investigated. 

Regardless of size, small or larger nonprofits should consider these common questions around security, convenience and affordability when considering a credit card processor: 

The Importance of Nonprofit PCI Compliance

If your organization accepts donations from credit cards, it's required to abide by PCI standards. This set of security standards helps ensure that an organization has done its due diligence to protect the sensitive nature of electronic transactions and donor information. Online donations are not automatically secure. Nonprofits must abide by these rules to help ensure that payment data is secure and cardholder data is kept unavailable from cybercriminals. 

PCI compliance is rigorous and a necessary component of a nonprofits overall security plan. Maintaining compliance is a signal to your donors that you are taking the necessary steps to secure their information and prevent fraud. Noncompliance could make it very difficult to retain or attract donor, which will have a direct impact on a nonprofit's ability to perform its mission. Additionally, noncompliance can result in hefty fines starting at $5,000. 

PCI compliance varies by organization and number of transactions processed each year. 

The good news is, most online payment processors are PCI compliant. Nevertheless, when conducting the research to select a processor, it's highly recommended that you review PCI compliance as part of the vetting process. You may want to ask the processor you select if there' are any additional things your nonprofit should or should not do to contribute to PCI compliance. They may suggest some best practices, such as don't store account verification data and don't collect or send card information via email. 

In addition to PCI compliance, quality processors will also have the following security features: 

These added security features and fraud prevention measures will provide your donors with additional peace of mind and may even contribute to their ongoing support. Ultimately, the responsibility to be PCI compliant lands on the nonprofit. 

Nonprofit Organizations and Credit Card Processing Fees

The only types of donations that are not subject to processing or transactions fees are cash and checks. It's common for payment processors to take a small portion of each transaction as compensation for the ability to accept electronic payment. So, if your nonprofit chooses to accept credit card payments from your donors, expect transaction fees. Most processors charge between 2-3% per transaction, but this varies based on processor and credit card. It's always worth asking a processor for a special rate, reduced fee or waived fee for eligible nonprofits.  

Most businesses simply incur transaction fees as a cost of doing business, but some nonprofit organizations have found relief from fees by asking their donors to pay the fees associated with giving with cards so the full donation amount will truly benefit their mission.  

Many donors are unaware of credit card fees for electronic donations. When asked, many are happy to contribute an additional, small amount to cover the cost of the transaction. Keep in mind, these donors have already invested in the nonprofit because they believe in the mission. Simply making it optional for them to cover the additional nominal fee could cover a large portion of a nonprofits total transaction fees. Many nonprofits will ask donors to consider covering the transaction fee right on the online donation form. 

Nonprofit Donor Software and Payment Processors 

Many established nonprofits utilize specific donor software to keep track of donor information in a database. These databases often include a variety of fundraising tools to help organizations improve donor engagement and fundraising opportunities, in addition to storing contact information. They can also keep track of donor giving habits and history, interests, preferred communication style, and more. For example, fundraising software may keep track of which appeals for donations have resulted in donations, how a donation was received, the amount of the donation, and if the donor would like to be thanked via a phone call, mail or email, or remain anonymous. 

If your nonprofit relies on software like this, it may be beneficial to integrate your donation software with a payment processor. An integration like this will save time and effort and eliminate manual data transfer.  

Accepting Credit Card Donations is Easy with BNG Payments

Selecting a payment processor for your nonprofit is a big decision. BNG Payments can help you raise money for your cause with no monthly fees and low cost-per-transaction. Whether your nonprofit is a small, local organization or a national association, we make it easy to accept gifts in a number of ways and offer donation kiosks, credit card and ACH Processing, online giving, recurring donations, text giving, and more.  

Contact BNG Payments to learn how credit card processing can be easily integrated into your fundraising efforts. 

 

A Guide to Wireless Credit Card Payment Processing

Wireless Credit Card Processing

A Guide to Wireless Credit Card Payment Processing

Portable card machines are designed to operate via built-in Bluetooth capability, and connect wirelessly through the internet. Once a customer's payment is read by one of these terminals it will then contact their bank in order verify if there are enough funds available for purchase before complete transaction processing.

As more and more businesses explore operations outside of fixed locations, wireless payment processing has gained popularity in recent years.  

Wireless processing is exactly as it sounds; it allows the payment terminal to wirelessly connect to the payment processor each time a card is swiped. Wireless processing uses a Wi-Fi connection or cellular data connection to process payments. This means the merchant doesn't need a landline connection to complete a transaction.  

A secure transaction is complete within a matter of seconds (depending on WiFi speed or wireless coverage) because a wireless terminal communicates between the business, the payment processor, cardholder issuing bank, and the business’ acquiring bank. A secure internet connection from Wi-Fi or a cellular data connection is required instead of a phone line or network. 

How Wireless Credit Card Processing Works

Wireless processing works in much the same way as a traditional fixed-location terminal. 

  1. The merchant slides a customer’s card through a wireless machine and enters the sale amount. Both the card and sale information are securely sent to the merchant services provider. 
  2. The merchant services provider then sends the sale information and credit or debit card details to the customer’s issuing bank where the card is verified. The issuing bank also confirms if funds are available. 
  3. The issuing bank either approves or declines a purchase and communicates with the merchant services provider appropriately. 
  4. Usually in a matter of seconds, the machine then receives transaction information back from the issuing bank. 
  5. The retailer or merchant settles the batches of transactions made from the terminal at the end of the day. After “settling,” the funds are transferred from the issuing bank to the merchant’s account.  

The Differences between Mobile and Wireless Credit Card Processing

Business owners should be cautioned not to confuse mobile processing with wireless capabilities. Both mobile and wireless credit card processing provide a business with location flexibility, but there are differences between wireless and mobile. With either of these options a business essentially has a portable credit card machine; the payment and checkout experience is no longer tied to a fixed location. This is an attractive feature for business owners and consumers alike. While the credit card machine technology sounds similar there are distinct differences. 

Mobile credit card processing utilizes a business owner or employee's mobile device, such as a cell phone or tablet, and an app from the payment processor. A mobile credit card machine accepts mobile payments and sends customer receipts via email or text. A piece of hardware can even attach to a smart phone or mobile device so a retail business can accommodate a wide variety of credit card processing types including chip cards or credit or debit card transactions with a magstripe card reader.  

Wireless processing, on the other hand, involves more. It has the same features as a traditional processor, only it isn't connected with cords. A wireless terminal can also print receipts, and often comes with a credit card reader with a keypad or display screen. Wireless processing is ideal for many business types that do not have fixed locations, but need a credit card reader, like delivery or repair services. These wireless terminals still allow mobile merchants to accept a wide range of payment types, including traditional credit or debit card payments.  

Benefits of Wireless Processing

Without the constraints of cords, payment processing can truly go anywhere. Wireless credit card processing lets small businesses operate anywhere there is cellular coverage with a handheld wireless device so they can meet the needs of their customers who increasingly prefer credit or debit card transactions over cash. The obvious benefit for a mobile merchant with this method of processing is the ability to collect payment immediately with a wireless credit card machine, rather than waiting several business days or weeks after sending an invoice. 

Wireless payment technology maintains security standards, so merchants can safely process transactions on the go. Additionally, this type of technology results in faster processing times. A mobile merchant customer base and staff appreciate a quicker checkout process, and the convenience of the receipt printer, which results in a better overall customer experience. Businesses who spend much of their hours outside of a physical location, even larger businesses, benefit from an affordable device that truly facilitates operating as a mobile credit card terminal with all the capabilities of a brick-and-mortar shop.  

In addition to providing customers with the payment options they prefer, the efficiencies and convenience offered by wireless capabilities can be subtle differentiators for businesses in today's highly competitive retail environment.  

Choosing a Wireless Credit Card Processing Machine 

Due to the variety of credit card machine options and payment processing providers, merchants should closely evaluate the differences, pros and cons of each. Business merchants should consider several factors, including price, customer service expectations, hardware, contracts and more, to gauge if wireless processing will benefit their mobile business: 

How to Compare Credit Card Processing Companies

How to Compare Credit Card Processing Companies

When it comes to maximizing sales potential, honoring credit cards should be at the top of the list to accomplish sales goals. As of 2021, credit cards are the most common payment option, making up 38% of all customer transactions.     

To run credit cards and debit cards, you will need specific software, hardware, and network connections from a payment processor and merchant services provider. Today, many payment providers have their own models and pricing, and unfortunately, not all companies are forthright and honest. Many companies disguise their fees or limit their offerings to save on costs. 

The better the processor, the more transparent their pricing will be because they have nothing to hide. And the more services they offer, the better they work as a partner toward your continued growth. But there are many other questions to ask to ensure you get both benefits.   

To help you with your shopping, here are some essential traits you should look for when selecting your provider. 

Do the companies offer EMV and PCI compliance?  

We're starting the list with the most critical detail to spot when shopping: data security. Data security is crucial to protect your business and your customers in today's market, and it will grow even more important as mobile and online payment capabilities increase. The more you are protected, the smoother your business will run and the less risk you will incur, helping you maintain low transaction fees.   

EMV Compliance consists of machines that support EMV technology, such as chip cards, smart payment processing, and PIN inputting. This technology is safer than swiping and prevents other reading devices from grabbing your information. EMV payment systems are the go-to fraud prevention method and will remain so for the foreseeable future. 

PCI compliance is a set of guidelines for data storage and network security that credit card companies require from businesses to protect customer information and prevent theft by employees or online hackers. You must adhere to these guidelines as a business or face denied service by the companies or higher fees due to your more elevated risk. 

If a provider offers PCI compliance, look for fees for PCI compliance, PCI non-compliance, and PCI regulatory fees. The rates may be high, affecting which provider you choose.   

Do the companies offer additional fraud protections? 

Does the company have additional fraud measures? If so, what are they? The more protection they offer, the more you are protected. 

What transaction fees do they charge?  

Fees are a crucial part of a provider's profit—so much so that some companies hide fees, and they hide them well. Some fees are also purposefully confusing. In both cases, the company hopes you won't ask about them in detail. 

Some fees are per transaction, while others bill monthly or annually. They have names like "regulatory fees," "compliance fees," and "statement fees." Be sure to ask about every type of fee and their average cost. 

Do they offer different pricing options? They Should. 

Several pricing options exist, including tiered, flat-rate and interchange-plus pricing. Look for a processor that offers a variety of pricing options. No one pricing option is a one-size-fits-all match for all business types. No one pricing option is necessarily better than another. It will all depend on your specific business needs. Investigate each pricing option thoroughly for your specific business. 

What are the rates for each transaction type? 

Most companies charge rates for each type of transaction based on their risk of fraud. For example, card-present transactions are the cheapest form because they carry the least risk. 

Today, orders can be placed within a store, on the road, via an online shopping card or e-commerce website, and each method has its risks. Rates also change based on the card type (VISA, MasterCard, American Express), the card level, and the types of goods and services you offer. 

Understanding the rates for the most common forms of payment you expect goes a long way in maximizing your profits.  

Setup Fees and Monthly or Annual Fees 

It’s common for processors to include installation and setup fees. You may also encounter annual or monthly fees, compliance fees, and statement fees. Thoroughly investigate each processor and ask specifically about its fees so you’re not caught off guard. If transaction rates seem too good to be true, dig deep into their remaining fees to spot how they make up the difference.  

How long do payouts take?  

In most cases, processors will provide next-day funding or second-day funding, the latter being the default. Knowing how quickly you will get paid can be essential to running your business smoothly. 

What additional services do they offer?  

Having additional services can make your job of owning and managing a business easier, even if you accrue charges for them. After all, your time is valuable, too.  

Is there a limit to how much I can charge?  

Processors can limit the quantity and size of orders—particularly when you are just starting. Limits may be expressed as a dollar limit per transaction or per month or as a flat quantity limit for a given period. Choose a provider that offers you as much flexibility as you need. You may also ask your processor if they would be willing to change any given rules. You shouldn't be penalized for success. 

How many forms of payment do the companies support?  

The more forms of payment a company honors increases the chance of a sale and lets you accept payment methods that best suit your business model. Inquire if the company honors all major credit cards and services, such as Apple Pay or Google Pay. If the company offers ACH payments, even better. ACH helps you maintain ongoing, monthly payments directly from the customer's account. 

Can my rates change?  

Yes. It may surprise you to learn nearly every processor reserves the right to change rates at any time—even those with a flat-rate posted on their website. You may consider asking a processor when rate changes are most likely. Be sure to carefully review contracts and pay attention to the small print.  

Are there cancellation and early termination fees?  

Some processors charge cancellation or early termination fees, while others don’t. Be sure to ask so you’re not caught unaware.  

Do I have options of renting and buying terminals and software? 

You may decide to rent for a lower out-of-pocket cost or buy for improved long-term savings. At BNG Payments we offer both options making it easy for you to select the option that's right for you. 

Shopping tip: When reviewing a provider's tools, ensure that the terminals work with other providers; otherwise, you may be locked into one provider or forced to pay for new terminals. If you need an online shopping cart, be sure the company's software is not proprietary.    

What type of customer support is available?  

As you consider processors, be sure to ask about customer support. When you need help, when and how is support available? Choose a processor with a dedicated support team. BNG Payments is known for exceptional customer care through its U.S.-based customer support. 

Shop around for a best-fit provider. 

Asking the above questions will lead you to quality providers, and the more you shop, the better you can negotiate a better rate while meeting the specific payment needs of your business. 

Be sure to include BNG Payments on your list of providers. Whether you're a brick-and-mortar shop, e-commerce company or a combination of the two, need mobile devices or stationary terminals, we have technology to meet the needs of your business in the most secure way possible. BNG Payments offers industry-leading technology to secure your transactions and simplify PCI compliance.   

Connect with BNG Payments to learn more

How to Mitigate Credit Card Payment Risks 

How to Mitigate Credit Card Payment Risks 

Credit cards are the number one form of payment with businesses today, and with more businesses offering online purchasing each year, the future of credit cards remains bright. At the same time, credit card fraud remains a serious issue. According to the Federal Trade Commission, 4.7 million reports of fraud were recorded in 2020 alone. The good news is small business owners can take several steps to protect themselves from credit card payment risks. Read on to find out how. 

How Does Credit Card Fraud Happen?

Fraud comes in different forms: 

As a small business owner, you are especially vulnerable to these threats. Small businesses typically have fewer data protections while also housing financial data from numerous customers.    

There are ways you can prevent and minimize attacks as a small business owner. Here's how. 

Ensure Your Business is PCI Compliant 

You've probably already heard a lot about the Payment Card Industry Data Security Standard (PCI DSS), commonly known as PCI. First introduced in 2006, it's a popular standard used by merchants to protect cardholder data. In short, all companies that process, store or transmit credit card information must comply with the PCI DSS. They may be banned from honoring credit card transactions or hit with painful service charges if they don't. 

Making your online store PCI compliant is essential for protecting your customers and business from credit card payment risks. To do so, you need to ensure that all of your web pages are encrypted and that you have a secure checkout process. 

Your payment processor can assist you with PCI compliance.  

Use a Secure Payment Gateway 

A payment gateway is a secure, online portal that reads the card information and forwards it to your merchant acquiring bank—the bank account that receives credit card payments—so the data can be sent to your payment processor.   

A payment gateway helps with card payments from card-present to card-not-present and online purchases. It provides an added level of security during transmission. If someone steals your merchant account information, you will be able to flag the purchase as fraudulent before the money leaves your merchant account. 

When choosing a payment gateway, be sure to look for one with PCI compliance to ensure that all your customers' credit card information is sufficiently secured. 

Tips When Running Card-Present Transactions  

All card payment types are ranked by their risk, and card-present transactions are characterized as having the least risk. Purchases made when your customer and their payment card are present are less likely to be disputed than a payment made remotely. Additionally, they are less likely to be fraudulent. 

Still, issues happen. An individual may have stolen the card or dispute the charge later after reviewing their credit card bill. Follow the practices below to minimize the risk of disputes when making card-present transactions. 

Implement strong customer authentication methods 

Require that customers provide more than just their credit card information when making a purchase. Request information like their driver's license, name, address, and date of birth to ensure only the authorized user is making the purchase. 

If the purchase requires shipping, see if the billing address, driver's license address, and shipping address are the same. If not, inquire why. 

Use EMV Terminals 

EMV stands for Europay, Mastercard, and Visa. This technology consists of security chips in credit cards, debit cards, and prepaid cards that store far more detailed information than a magnetic stripe card and are extremely hard to clone. An EMV card can be inserted or tapped onto a reader without the threat of another device picking up credit card data for fraudulent means. Running orders through EMV cards almost always requires the customer's original card, virtually eliminating the risk of a fraudulent card. 

Due to the effectiveness of EMV technology, the credit card industry has shifted merchant liability. Now when merchants run orders through traditional swipe technology, they are automatically liable for fraud. 

Card-Not-Present Transactions 

If you accept orders over the phone or have online purchasing capability through a virtual terminal or an e-commerce website, the customer won't be physically present in front of you. This is a more convenient way for customers to buy, but verifying the customer is the actual customer is more complicated.   

Here are some steps you can follow to minimize the risk of payment disputes. 

Obtain All the Card Information 

During a phone call, ask for all details like the name on the card, billing address, expiration date, and CVV code. 

Get Delivery Confirmation 

As mentioned earlier, inquire if a customer's billing address and shipping address are not the same. Additionally, require that the customer signs for delivery. 

Get Proof of Service 

Have your customer thoroughly review and sign a work order for any services you provide and keep the signed paperwork for future reference. Additionally, teach our teams to spot signs of fraudulent behavior and follow concrete steps when they suspect someone is trying to use a stolen credit card. 

Post Your Credit Card Policies 

Provide an online resource portal where your employees can reference your credit card policy at any time. 

Create Secure Passwords and Two-Factor Authentication 

Advances in technology make it easier than ever for criminals to get their hands on credit card data. Ensure you and your employees use complex passwords and regularly change them—as frequently as every few months. Pair passwords to critical logins with two-factor authentication.  

For online purchases, confirm the person making a purchase is not a bot and is who they claim to be. 

Keep Your Computer Systems Up to Date  

Hackers are constantly working on new methods of stealing credit card information from point-of-sale systems. Ensure you have the latest security patches installed on your computer and all anti-virus software is updated. Make it a habit to regularly evaluate your virus protection and stay up on the latest fixes. This work may be outside of your interest level and expertise, but a managed service provider (MSP) and payment processor can help. 

Encrypt and Truncate Billing Data 

Prevent credit card information from being read in your billing software, data systems, and paper copies by using encryption and truncation. Encryption conceals credit card information using mathematical techniques while requiring a password key to decrypt the data. 

Truncation is an FTC-required strategy where the credit card information shown on receipts is limited. For example, it may exclude the first six and last four digits of the credit card number. 

Your payment processor or managed services provider can ensure you have each of these solutions in place. 

Educate your Employees about Credit Card Payment Risks 

Employees are ideal pathways for data thieves to collect customer data, and this also makes your employees your first line of defense against credit card payment risks. Educate them about credit card fraud and how to protect your business. 

You can start by creating a policy for handling credit card information. This policy should include storing, processing, and using cardholder data. You should also hold regular training sessions for your employees, updating them on new security risks and best practices. 

Restrict Access 

Restricting access is another way to prevent data thieves from gaining customer data through your employees. Limiting access prevents data from accidentally falling into the wrong hands and prevents direct theft from your employees. Restricting access to only you or select members of your team also keeps you aware of which employees requested any needed client data and when.   

Keep Paper Data Under Lock and Key 

If you have files with customer data, keep them inside lockable file folders. These papers can be easily stolen, lost, or mistakenly discarded, only to fall into the wrong hands.   

How to Reduce Fraudulent Claims 

Credit card fraud happens, but misunderstandings also lead to credit card fraud claims. Here are some ways you can prevent issues with clients. 

Gain Written Permission for Recurring Payments 

Require cardholder permission to charge for goods and services regularly. Make sure to obtain their signature on an official document that clearly lays out information, such as the transaction amount, charge frequency, and contract duration. 

Add Your Contact Information to Credit Card Statements 

Include your business phone number and address on any receipts, so the customer calls you first before disputing a charge. 

Publish a Refund Policy 

Provide your customer with an explicit cancellation and refund policy on the receipt so they know when to dispute a charge or not. 

Make your Business Name Recognizable 

An easily recognizable business name on a customer's credit card statement prevents questions and fraud claims. If your business name is different or long (more than 35 characters), add your location and product description. 

Have Clear Terms and Conditions on a Signed Invoice or Receipt 

Unfortunately, customers sometimes dispute charges and claim fraud to get out of paying. Having easily viewable terms and conditions on a receipt reminds customers of the legal agreements during the purchase and provides valuable evidence when disputes are filed.

Use a Reliable Payment Processor and eCommerce Provider 

A quality payment processor joins PCI compliance with advanced protection programs. Look for automatic tools like machine learning and AI to bring powerful, ongoing protection. Additionally, look for e-commerce platform providers that offer integrated fraud solutions. 

BNG Payments: Your Processing Expert  

Following the above tips will help you protect yourself from credit card payment risks. BNG Payments can also help. We are a reliable payment processor with a solid reputation in the industry and know the best payment systems, software, and strategies to protect your customer data. We offer the latest EMV tools and protections, and our payment system can also simplify PCI compliance. We can even customize our offering to fit your current systems and way of work. 

Contact BNG Payments to learn more.

How You Can Find Business Savings with Your Credit Card Effective Rate 

How You Can Find Business Savings with Your Credit Card Processing

If you run a small or medium-sized business, you know that every business cost you pay directly affects your profit. The more you know where and how to lower costs, the more money you make.   

One way to keep your monthly costs down is by lowering credit card transaction costs. You will be charged transaction rates from your payment processor, merchant acquiring bank, card associations, and in some cases, even your merchant services provider. Each has its own methods of charging and opportunities for lowering payments. 

In this article, we will focus on payment processors. You will learn different ways you can save on credit card processing fees while helping you understand if you pay a fair rate in the first place. Knowing your company’s effective rate is a powerful barometer for seeing how much you overpay. 

What is an effective rate?  

How You Can Find Business Savings with Your Credit Card Effective Rate 

An effective rate is a formula in which you take the total processing fees from your payment processor’s monthly bill and divide the total number by your total sales for the same period. You will end up with a number that you will express as a percentage. 

Typically, a good effective rate is around 3% to 4%. To lower your percentage, look at the backend fees you pay. 

Some fees you can work around, while others you can negotiate. Let’s look at various fee types and models to see how they can be lowered. 

Review Your Business Type  

Businesses are categorized by the type of goods and services they offer and their related risk. Find out what category your business is in and how much you are charged for it. You can shop around to see if other providers offer lower rates for your category. You may also have some flexibility in defining your category depending on your type of business.  

Revisit Your Transaction Frequency  

Do you typically run a low quantity of orders? If so, the average you tell the provider during setup determines your rates. If your typical quantity is high, you can negotiate lower rates. The more transactions you run, the lower your rate. 

Revisit Your Pricing Model  

Knowing your order frequency also helps determine the best pricing model. In general, there are three pricing models to choose from: interchange-plus, flat fee, and blended pricing. Each model has benefits. 

Interchange-plus pricing shows every cost involved in each transaction. You see exactly how much you pay for specific payment methods and card associations to spot where and how to reduce costs. 

Interchange-plus pricing is typically lower than other models and is especially effective for businesses with large numbers of transactions. You benefit even further with lower rates for higher numbers of transactions. 

Flat fee pricing is a set fee for each transaction. You know exactly how much you pay per transaction, which helps with business budgeting. Thanks to its lower monthly fees, this model is typically best for businesses with low transactions. You still maintain some cost transparency. 

Tiered pricing has separate tiers: qualified, mid-qualified, and non-qualified. Qualified purchases have the lowest fees, and non-qualified purchases have the highest. You can save money by ensuring the majority of your transactions meet the qualified tier. But be careful. Non-qualified purchases can be very expensive.   

Avoid Hidden or Excessive Fees 

Unfortunately, not all processing fees are easy to spot or understand until you sign the contract. Less-than-forthright processors capitalize on this. You can cut down on these fees by carefully reviewing each one before signing, refusing unnecessary fees, and negotiating lower fees by shopping around. If you already have a contract, keep a careful eye on charges to see which fees to avoid and which are accidental. 

During signup or renegotiations, look for traits like:    

The Type of Transaction  

The type of transaction also determines your rate. Pricing is related to the risk of fraud, and some types of transactions are deemed safer than others. For instance, card-present transactions have the lowest risk of fraud, so they have the lowest percentage cost. Manually-inputting credit card information during a phone purchase is a higher risk. 

Every single transaction method is priced by risk, including using a virtual terminal on a website, using an eCommerce website, and offering mobile processing. You can maximize savings by limiting payment options to what is financially best for your business. 

Rates are also affected by how you run the card in a machine. If you use an EMV terminal, you pay less per transaction than if you swipe a card due to EMV’s stronger protection against fraud.

Your Credit History and Credit Score 

Like your business type, your credit score is used by providers to determine your rate. A low credit score indicates you may be a high-risk client, resulting in higher rates. To keep pricing down, pay all bills on time and keep a close eye on your credit score to spot when you are dinged for late payments. 

Change Processors 

If you still think your rates are too high, you can cancel your contract and move to a lower-priced processor. Keep in mind that shopping by price alone may not benefit you. A higher-priced processor may offer additional services that help your business at no charge. Additionally, some processors charge a high cancellation fee. Weigh the pros and cons of the costs of leaving. If you switch processors, you may choose a new provider that doesn’t charge a cancellation fee.  

For a Blend of Competitive Pricing and Quality Offerings,  Contact BNG Payments  

BNG Payments has extensive experience in the payments industry. We work closely with customers to help them understand the benefits of each pricing model. Our customers benefit from competitive pricing and excellent customer service, along with industry-leading payments technology. Contact us to learn how BNG Payments can help your business.

How to Report Credit Card Fraud as a Merchant

Steps to Follow When You Suspect Fraud 

Credit cards are a top way to receive customer payments, but as a business owner you may receive a fraud claim or spot a questionable transaction. It pays to know how to handle these situations. Theft is all too common with credit cards, and you may be liable for fraud claims.   

This article shows you how you can report credit card fraud when it happens and explains how you can decrease your liability. 

What is Credit Card Fraud

Credit card fraud is when a credit card or related account information is used for purchasing goods or services without the cardholders permission. It can be from a stolen card, misappropriated card number, or forged card. 

Are Merchants Responsible for Fraud from Credit Cards and Debit Cards 

When fraud happens, there is a charge to cover fraud services in addition to recouping the customer’s losses. These charges fall to either the credit card issuer or you as the merchant. 

Online transactions and swipe transactions are high risks, which means you as a merchant are liable. The liability falls on the issuer for chip cards, and we’ll explain this later in the article. 

Additionally, if you don’t 100% follow an issuer’s fraud procedures, you increase liability. If multiple issues arise, you will also be categorized as a high-risk merchant by your merchant bank and processor, resulting in higher fees. 

Types of Credit Card and Debit Card Fraud 

There are three terms often associated with credit card fraud, each with liabilities. 

Card-Present Fraud occurs when a person is standing in front of you as you run the order. In this case, the card may be counterfeit or stolen, or the individual may verbally provide account details. In these situations, banks are typically liable, though you will still have to pay the standard transaction fee for that type of purchase. 

Card-Not-Present Fraud occurs when a person provides credit card details over the phone or online. Card-not-present transactions are considered high-risk purchases of which you will be liable. 

Friendly fraud is when a less-than-reputable customer makes the purchase but still disputes it as fraud. In this case, the customer will be liable. 

What to Do When  Credit Card Fraud Occurs

If the order was placed and you suspect fraud, the best course of action is the following: 

Delay Shipping 

When possible, delay order fulfillment for a few days so that you can get the verifications you need. If you fulfill and/or ship an order quickly, you may become liable for the transaction. 

Contact the Customer or Issuing Bank

Contact the customer by email or over the phone to ensure the order is authentic. You can also contact the card-issuing bank; they can reach out to the customer for verification. 

Contact Your Card Protection Service 

If you have a registration service/card protection service, contact them; this will help reduce the number of chargebacks you experience. 

Steps to Combat Credit Card Fraud

The best way to avoid fraud is by preventing it before the sale. Here are ways to do so: 

Look for Sales that Appear Too Good to be True

If a sale seems uncharacteristically good, such as overly large, and requests immediate delivery, you may suspect fraud. 

Require Multiple Forms of Identification

Ask for a drivers license, phone number, and address associated with the card. You can also confirm the address by contacting the cardholders issuing bank. 

Call for a Code 10

Call the issuerauthorization center and ask for a Code 10 authorization. They will assist with approval by providing any additional data you need and can also help by calling the police if necessary.  

Run Cards with EMV Chips

Europay, Mastercard, and Visa (EMV) chips are standard today and provide an added level of protection against swiping cards. In the case of card-present charges, you can be released from liability by using these newer chip readers instead of swipe technology. 

Consider an AVS System

An address verification system (AVS) requires the customers zip code and address number (not the full address) before each purchase. 

Require the Cards CV Number

Requesting the CV number during a phone or online transaction means the customer is more likely to have the card on hand, reducing fraud risk. 

Offer Digital Wallet Payment Capabilities

Digital wallets reduce the need for physical credit cards while bringing added protections and approval requirements, such as thumbprint verification.   

Use Fraud Tools Provided by Your Payment Processor 

Your Payment Processor may have ways to detect fraud that isnt readily apparent to you. Inquire with them about how you can reduce the risk of fraud. 

Update Your Policies and Procedures  

After a fraud occurrence, updating your policies helps ensure it doesnt happen again. 

Follow the Rules 100%

Learn the rules set by card issuers, networks, processors, and your merchant account, so you know how to fulfill your obligations and limit liability. If you dont, you can lose your merchant account and risk high fees for transactions. 

BNG Payments can Help 

Reliable payments from customers through a reputable payment processor benefit everyone.  

BNG Payments is payments processing made easy. Whatever your processing needs, we focus on security and make it easy for merchants to accept credit and debit cards, mobile payments, e-commerce, and more.  

Contact BNG Payments to find out what we can do for your business.

 

 

 

 

 

Are your Customers’ Payments Secure?

Do you Really Need Cybersecurity?

As a business owner, you likely already know how credit cards and ACH payments increase the chance of a sale while increasing the number and size of transactions. But, accepting payments through POS hardware and software brings questions about data security and risks. Just how important is it to protect yourself and your customers from cybercriminals? 

It’s crucially important. Strong security is not just nice to have; it’s required to abide by local laws and processing rules and contribute to continued customer growth. 

In this article, we examine why cybersecurity measures are vital to your business. We also provide ways to get started. 

What is Customer Data Protection?

Data comes in many forms, such as customer contact information, employee records, customer transaction records, and payment information—and all of this information is valuable to hackers. The data needs to be protected to prevent the theft of sensitive customers information. If your system is breached or data is stolen, hackers may resell the data to other hackers, create false identities to access banks or credit cards, and even hold account owners for ransom.   

Data protections are any measures you take to protect that data. Protections may include restricted access to information on computers and electronic devices and blocking access to hard copies. 

Why is Customer Data Protection Important?

The Threat is Real

Without protections in place, you are now more vulnerable to phishing and identity theft than ever before. According to Cybercrime Magazine, cybercrime is estimated to cost companies around the world $10.5 trillion annually by 2025. Cybercrime doesn’t only affect large businesses; small businesses are increasingly targeted, and 60% of small businesses go out of business after a cyberattack or data breach.  

Data Protection is Required by Law

Data breaches have led to increased concerns from customers and governments to set data protection rulesThe General Data Protection Regulation (GDPR) for European businesses and the California Consumer Privacy Act (CCPA) are examples of such regulations. Additionally, half of all U.S. states have their own rules about data protection.  

PCI Compliance is Expected 

Payment Card Industry (PCI) compliance is a set list of standards set by electronic payment networks. These guidelines aren’t federally mandated but may better protect you from liability if a data breach occurs. If a breach occurs at your business, you’ll face higher rates from your payment networks, processor, and merchant account due to being deemed a higher risk.  

The good news is, PCI compliance is made simpler with a payment processor that prioritizes security.  

You Need That Data

Customer data is becoming essential for improved business performance and staying ahead of the competition. You can use it to improve your products and services to fit client needs better. You can also generate more sales with less effort through more intelligent and effective marketing efforts. 

You can even serve individual customers better, which is especially advantageous when you consider that repeat customers make up 25% of an average business.   

Maintaining Customer Trust is Vital 

Due to high-profile data breaches worldwide, businesses are increasing their protections. And, customers are warier of providing sensitive data. McKinsey and Company surveyed 1,000 North American customers and found that customers are becoming more cautious about providing information due to large-scale data breaches. They are also more prone to limit sharing their data to only what’s relevant to each business.  

It bears repeating, return customers make up 25% of a business’ average customer base, so providing security measures to alleviate their concerns is crucial. You want your customers on your side—not just to help you maintain your business but also to grow it by recommending you to their family and friends. If you don’t have security protocols in place, you could lose your customer base and severely damage your reputation. 

Customers often willingly provide their data with the understanding that it will be protected and not shared or abused. If customers have a poor experience with your business, they’re more likely not to return and spread the word, which could be detrimental to your business 

Maintain customer trust, and possibly even grow, by committing to better securing your customers’ information and having protections in place. Be more selective in the data you collect, and be transparent and honest about your data usage.  

How to Maintain Strong Cybersecurity

The following are ways to improve your cybersecurity. 

Maintain Current Security Software

Ensure your anti-virus, anti-malware, and anti-spyware software are up to date. Regular updates provide greater security. A managed service provider (MSP) can assist, but you may also set the software to update automatically. 

Encryption

Encryption disguises data, such as credit card numbers, birthdays, and addresses, by converting it into unreadable code that can only be translated with a key. Your payment processor can provide encryption for credit card data, and you can also use encryption to hide any dataeven in emails. 

Block Access to Hardware 

Use secure passwords with more than eight characters and symbols and numbers. If you have a shared password, limit who has access and require encryption. 

For hardware, such as laptops, smartphones, and flashcards or USB sticks, have a dedicated location where these items are returned and locked. Any paper copies that have financial information should also be stored under lock and key. 

Boost Network Protection

If you have remote access to your internal server, invest in VPN technology. For even more flexibility, move your system to a cloud network with advanced protections and access restrictions. A trusted managed service provider (MSP) can help with this. 

Regularly Monitor Data

Know where all data is stored and regularly monitor to ensure there are no surprises or weaknesses to access data. 

Vary Security Levels for Data Access

Control access to data by allowing only certain employees to access specific data types for particular purposes. These safeguards limit paths for hackers. Employees are a chief source of data breaches, whether intentional or not. 

Limit Data

Gain customer trust while still fulfilling your marketing and advertising needs by limiting the data you collect. Less data means less value for a hacker. 

Formal Procedures and Training 

Train your employees to follow a list of cybersecurity guidelines, including opening, closing, and in-office procedures, as well as learn how to spot phishing and ransomware emails.

BNG Payments Can Help

BNG Payments helps businesses of all sizes. We assist customers with PCI compliance, payment data security, encryption, and other services.  

BNG Payments prioritizes payment security. Connect with us to learn more. 

 

 

 

 

 

 

A Complete Guide to B2b Credit Card Processing

B2B Credit Card Processing / How Honoring B2B Payments with Clients Boosts B2B Sales 

As a small business owner, one way to increase sales potential is to offer multiple purchasing options for buyers. Standard payment methods include cash, checks, ACH, e-wallets, debit cards, and credit cards. But one sales category worth looking at more closely is B2B sales. More transactions are done between businesses than between businesses to customers – especially with recurring payments. You can benefit significantly by finding better ways to serve your business clients.  

Businesses are increasing their use of B2B credit cards during business sales. Though it is wise to honor B2B credit card transactions to keep a client happy, there are benefits for you too. These cards are a powerful ally to improve margins for faster growth. 

This article reviews the world of B2B credit card processing and why it's crucial.  

A Complete Guide To B2B Credit Card Payment Processing 

Credit cards are increasingly being used by companies to charge expenses. If you run a B2B company, it might be worth exploring the ins and outs of processing credit card payments for your transactions with other businesses. Here are the reasons why, but first, what do we mean by B2B credit cards?   

What is a B2B Credit Card, Exactly? 

B2B credit cards, also known as commercial credit cards or corporate cards, are much like a customer credit card but have added benefits worth discussing with your clients and even for your use. 

When you allow for B2B credit card payments as a business owner:  

Benefits Over Paper Checks 

Historically, the most popular way businesses pay for products and services is with checks, but the work of cutting, sending, and processing checks makes this B2B payments process more labor-intensive and time-consuming than paying with a credit card. In the business world, time is money, both for your client and you. In addition, you must wait longer for payment due to the mail and longer billing cycles for businesses, such as 30 days.  

Checks can also be lost, stolen, frauded, and inputted incorrectly, further bumping out the timeline. Then you will also have to contend with clearance of checks with your bank, which can take longer than a week for more comprehensive reviews. 

The total aggregate cost for check processing ranges between $4 to $20 per check transaction, and these costs include all labor time, shipping, and bank charges. 

With credit cards, business orders can be placed by you or your client instantly online from anywhere using your payment gateway. In addition, you can still take payments over the phone and in person. The entire process is much faster no matter how it is done and at a lower cost ranging from 1.8 to 2.9% plus a 10-cent transaction fee.  

 Invoice Benefits of B2B Payments 

You also enjoy advanced accounting tools such as digital invoice creation, reoccurring payments capability, custom software integration, and accounting integration. These benefits keep you organized and are so advanced and easy that they could do the job of manually generating an invoice redundant. You won't have to contend with processing a backlog of invoices so that you, your sales teams, and your accounting staff can pursue other critical business initiatives. Additionally, you can create recurring reminders to ensure clients pay on time.  

More Savings through Lower Interchange Fees 

What are interchange fees, and how do they affect how I accept B2B payments? 

As with customer credit card purchases, you are charged interchange fees by the credit card issuer and your processor, but B2B interchange rates are lower than B2C processing costs. You can keep interchange costs even loser by shopping other processors for lower merchant processing fees. You will need specialized software and must meet several requirements to gain the correct status for this added discount for B2B transactions. 

If you run many transactions, these savings on interchange fees result in significant discounts that benefit any business. For example, if you run a nonprofit, savings can significantly increase the good you can do. 

How Merchant Category Codes Bring Added Cost Savings 

Merchant Category Code (MCC code) is a unique code that credit card companies use to classify your business based on the services and products you offer. Each card has its methods of classification and coding. 

The correct MCC code must be attached to your account through your merchant account provider to benefit from this interchange savings. Keep in mind each credit card provider has its codes.  

Levels of Credit Card Purchases 

What Kinds of Savings Can I Expect from Data Levels? 

Business credit card transactions fall into one of three levels: Level 1, Level 2, and Level 3. Customer credit cards remain at Level 1. Though the names and requirements of each level depend are different for each credit card company, the more information (data) you have on an invoice, the higher the level you climb and the lower the price you pay as a B2B merchant. Inversely, any gap in data can affect your level and, therefore, your discount.  

Some common examples of information you need to provide at each level are:

Level 1:
Level 2:
Level 3:

Interchange fees may fall from a Level 1 cost of 2.81 percent to 1.8 percent at Level 3. Note that not all merchant accounts honor levels 2 and 3, so be sure to check with your merchant account and, if needed, pay upgrade fees.

B2B Gift and Loyalty Card Processing 

These options are excellent for maintaining reoccurring sales and are available in affordable options, letting you provide the same high level of service as national companies. They also help you stand out from your direct competition, maintain customer recognition and frequency, and boost your company identity with your customers.  

B2B Mobile Processing 

Mobile processing options have extended far beyond a single countertop credit card terminal. You can now take orders on computers, mobile devices, and proprietary handheld devices for payment processing anywhere you and your sales teams are. Accept payments and track individual sales performance across multiple devices on the same merchant account. This system works with both cellular and wifi-enabled devices such as iPhones, Android phones, and tablets. 

B2B Online Payments 

Take payments over the phone or online without the need to have credit cards physically present. Customers can pay at a day and time that's most convenient for them. You can enjoy e-commerce solutions such as shopping cart capability, mail order, and telephone order capabilities, all at affordable prices to benefit any size business. 

Security of B2B Credit Card Processing 

There can be some apprehension about running credit cards due to perceived issues with data security. Still, full protections in place aren't only beneficial and even required for added peace of mind.  

BNG Payments: Offering B2B Merchant Services and Payment Processing 

BNG Payments have positioned itself as both a merchant payment processor and merchant services provider, making us a one-stop source for secure processing and quality back-end merchant services and support for business of any size. Our expertise in B2B and B2C payments results in faster, more reliable processing with the full ability to read each transaction on any device. And with full digital e-commerce capability, phone order capability, and advanced fraud protection through collaborations with top-tier financial institutions, you can accept payments in more ways as your business evolves. 

We connect you to the full range of B2B credit card processing options and assist with setup. You get all of these services at a competitively low rate and without the need for a contract, saving you further. Along the way, you get the same high-level 24-7 manager support you would expect for a large enterprise client. 

Large corporations and publicly traded companies have used our secure payment processing services to help them conduct large payments at reduced costs. It's time for you to experience these benefits yourself as a small business. Contact us today. 

How To Accept Online Payments In 2022

How To Accept Online Payments / Online Payment Processing for E-Commerce Businesses in 2022 

If you are looking for the single best way to take payments online for 2022, the short answer is that there isn't one. Today's wide range of online purchasing options has created a boom in online purchasing. All combined, there were over two billion online purchases in 2020 alone. And when it comes to selecting options, the more you provide, the better your chances for a sale. 

For anyone running an e-commerce business, online payment has become a necessity for remaining competitive. At the same time, companies in the e-commerce industry are looking for ways to make it easier to collect money online. Business owners with an e-commerce site can select an individual payment type that best suits their industry and blend multiple solutions for even greater returns. No matter which you choose, each payment method is designed to make the entire payment process more accessible.  

How do you get started with online payments as a small business owner? This article will show you how, as well as provide the top online payment methods for 2022.  

How To Accept Online Payments In 2022 

In this guide, we'll be talking about how to accept payments online. Payments are a crucial component of e-commerce and can have many different forms - from ACH deposits to credit card processing! The complete list of options includes:  

Examples of popular online payment options for 2022 include: 

We will cover each method further in the article, but first, how do you set up online payments?  

Understanding the Online Payment Process 

How do I accept online payments? 

You can take online payments directly through your website or connect your website to an outside payment portal, such as PayPal. The entire process involves using a payment gateway, payment processor, merchant account provider, and merchant services, provider. Let's look at each. 

How an Online Payment Gateway Handles Payments from Customers  

It helps to define a few terms first:  

In general, the process works as follows:  

There are different gateways to fulfill other payment methods (credit cards, ACH, Google Pay, Apple Pay, etc.) The more gateways you offer, the more options you provide customers for payment. 

All of this approval process is, in most cases, instantaneous, but the completion can run in a few business days. 

The gateway can be built into your website or housed separately, and some gateway providers offer both capabilities. When housed independently, they are called "hosted payment pages." In some cases, these providers can sync directly with your online form to resemble your branding.  

How Online Payment Gateways and Merchant Accounts Work Together  

Merchant accounts are special business bank accounts provided by merchant account providers that allow electronic payments (EMTs). These business accounts hold funds collected from customers until the funds are authenticated and cleared for placement into main business accounts. In many cases, merchant accounts are provided to online businesses when enrolling in payment gateways. 

These bank accounts come as one of two options:  

What is a Merchant Services Provider 

merchant service provider is a company that sets up payment gateways for online and brick-and-mortar businesses and offers all the hardware and software systems needed to conduct these online transactions. We offer these services here at BNG Payments. 

Security and Fraud Protection  

Using the internet for payment often brings up questions of data safety. In reality, this type of payment is safer than cash, a paper check, and even a wire transfer because there is in-depth fraud management at each transaction stage. An independent fraud check by the payment gateway, payment processor, and payment network, resulting in multi-layered fraud protection. 

7 Ways To Accept Online Transactions In 2021 

Let's look at each of the above payment options in detail. 

Credit Cards and Debit Cards, including Chip Cards 

Credit card payments are the most popular online payment option because customers can collect airlines miles and cashback payments. Accepting debit and credit cards is one of the easiest ways for your company to accept online payments. 

Mobile Payments 

In this option, customers can make purchases from a mobile device using mobile payment apps. As a business owner, you can also collect payments. Al you need is a smartphone, processing app, and a swipe or chip card reader. Other compatible devices include tablets and proprietary handheld devices. 

Benefits extend beyond mobile capability. You can receive instant confirmations, and email receipts are sent immediately to customers. You can also access cash flow reporting, manage customer accounts, and send invoices anywhere there is a phone signal. 

More than half of all US payments online are taken on mobile platforms, and these platforms are quickly becoming the norm for many customers and businesses. For this reason alone, your gateway should offer a robust mobile experience. 

To circumvent security concerns customers might have about storing their credit card information on a mobile app, your company should consider offering a secure payment acceptance method to provide more value to your customers. 

ACH Transfer Processing: Direct Debit and More 

Automated Clearing House (ACH) is an electronic bank network offering direct bank-to-bank transfers. The cost of ACH processing is lower than traditional credit card payments, debit card payments, and all other forms of electronic payment. Combined with recurring payment capabilities, ACH has brought improved conveniences for both customers and businesses. When also factoring in its ability to take eChecks, this payment process has grown by as much as 6.7 billion in 2019.  

ACH is a fantastic way to receive ongoing, future purchases from customers, pay bills to vendors, and pay employees via direct deposit. You can choose payment options such as a per-transaction, per-percentage, or per-month fee. Some banks offering ACH services may not charge a fee at all. 

Electronic Checks (eChecks) 

Electronic checks allow your customers to input bank information online, much like a standard paper check, or you can process a customer's actual paper check through your ACH system. These eChecks cost less than a bank fee, and you get funds faster.  

Digital Wallets 

Digital wallets are specialized software that stores funds inside of an electronic account. This option is an ultra-convenient way for customers to make contactless payments through their smartphones or smartwatches.  

Click-to-Pay Email Invoicing 

This invoicing tool lets you send a link inside an email that customers can then click to access your online payments system. After just a few clicks, receive payment for your invoice, and your customers receive a receipt/instant payment confirmation within seconds. The invoice is also automatically marked as paid in your accounting software.  

This payment method, along with other online payment options, meets customer demand for paperless billing - a growing desire from customers today. If you are looking to add customers to this option, be sure to mention this benefit for improved interest. 

Sale Emails  

Just like email invoicing, you can install links for payment right inside a sale email. A sale email with a hyperlink is a strong option for immediate purchasing.  

Cryptocurrency Payments 

Bitcoin and other blockchain digital payments are increasing in popularity, with even conventional businesses like Starbucks, Whole Foods, and AT&T joining. As with all other options on this list, this payment method will require the right gateway to honor payment.  

The Costs of Payment Gateways 

Each gateway requires an additional cost to cover operational costs but offers omnichannel payment options. Some charge a monthly fee and per-transaction fees as either a percentage or price per transaction. In addition, you will have your regular rates for each network, such as a credit card network or ACH network. 

How To Start Accepting Customer Payments Online 

A payment processor and merchant services provider can help set up your online payment gateway and any needed hardware and software. A company that offers both benefits for businesses makes the entire conversion process more manageable. 

BNG Payments offers the full range of merchant services to connect you with payment networks and conduct online transactions. We are your all-in-one payment provider for any online payment processing needs. We know the leading hardware and software systems on the market, regularly offer the full range of devices for mobile and eCheck payments, and assist with syncing these systems to your current accounting software for immediate billing and sales readings. Our in-depth experience in the industry has made us a vital source for eCommerce businesses.  

To learn more about these and other services we offer, click here. 

Integrated vs Non-Integrated Credit Card Processing

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Sometimes in the industry, we forget that most people do not understand its jargon. One prime example of this is the concept of integrated vs non-integrated credit card processing. To clear the air, I wanted to write a quick piece explaining the differences for businesses.

Integrated Payments

Integrated processing is simply processing that is built into the Point of Sale, CRM, or PSA Software you are using. It does not typically require you to re-enter an amount into a payment terminal/virtual terminal, instead the payment solution pulls the amount from the software system itself.

Integrated processing is convenient and efficient. Typically, when you have integrated processing, there is a lower chance for errors as the data is coming directly from the system you are using and does not rely on additional data entry by a human.

Lots of companies that have complex invoicing processes would benefit from integrated payments, as it creates a centralized location to track customers' transactions and updates the data in your accounting software or PSA software.

Non-integrated Payments

Non-Integrated processing solutions are the opposite. They typically require input from a human outside of the software solution being used. This can sometimes cause reduced efficiency or human error in transposing the value to be charged from the software solution. The benefit of non-integrated processing is that, without having to deal with the limitations built into the software, they can be much more flexible than an integrated processing solution.

Non-integrated processing also means you can utilize the latest payment technologies and solutions without having to wait for your software solution payment provider to catch up with the latest industry trends. Since they are not restricted by the technology they integrate with, adapting to the newest payment methods takes less time. In addition to staying on top of current trends, most non-integrated processing solutions also need to be more competitive on pricing as they know they can be easily replaced.

If my system offers integrated processing, should I use it?

This question comes up more often than you would think. For your business, it comes down to two options: do you want the ability to take multiple types of payments, or the ability to integrate with specific software your business uses?

Some systems with integrated processing have limited options for processing, meaning you can only process ACH or credit card payments. The reason for this is because older software systems may not support features like EMV or NFC payments or are still catching up on developing those capabilities for their software if they ever do.

Some merchants want to utilize a cash discount program, which is not supported on most integrated solutions. Sometimes, integrated payment solutions have a higher than necessary price as they know that no other processor can replace them as the integrated solution, so they feel that they do not need to be competitive.

So, which one is better?

That is not an easy question to answer.

For some business types, the efficiency and accuracy of an integrated processing solution are very important. For other business types, the ability to accept payment the way your customers prefer can sway some businesses to move to non-integrated solutions. At BNG, we offer a wide variety of integrated and non-integrated payment solutions to help meet the demands of a diverse client base.

Not sure if you have the best payment solution for your business? If you are trying to decide which is best for your business and you would like to discuss the pros and cons of each option, feel free to contact us and one of our sales professionals can walk you through the options.

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Payment Expert

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