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Is It Time to Ditch Your Credit Card Terminal?
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By Scott Gregory

That credit card terminal sitting on your desk processing your transactions may be costing you a lot more than you think!

Were you aware that in many small business accounting packages today, you can integrate the processing of credit cards directly into the software, and eliminate the need for a completely separate credit card terminal?

Automating is a Breeze

For example, in QuickBooks, when you process your cash receipts, there is a handy little button that says “process credit card transaction now.” By pressing this button, you are directed to a secure web site to immediately process the credit card transaction. You enter the basic information about the card as you normally do, and then click the “submit” button. You then receive approval or rejection of the transaction. If it is accepted, the transaction is then batch processed into your bank account automatically. The process in Peachtree and other accounting software is very similar.

Compare this process with your current procedures. First, you have to manually process the credit card transaction via the separate terminal. Once it is completed, you must re-enter all that data into your accounting software to show that the customer has paid their invoice. As you know, time is money! All the time you spend re-entering that data could be put to much more productive (and profitable) use within your business.

What to Look For

As you evaluate the possibilities of moving to an integrated, online credit card processing system such as this, pay close attention to the following:

• Time to funding. This is simply the number of days it takes from when you process the credit card transaction until the funds actually appear in your bank account. Compare your current plan to the time funding is offered by the integrated systems. You may be pleasantly surprised to learn that you can (and should) actually get your money faster under the integrated plan.

• Monthly fees. Both terminal and online processing come with monthly fees. It is important to compare all of the fees you are currently paying to process your credit cards against those of these newer services. Remember to include the monthly rental fee you may be paying on the credit card terminal itself. In addition, there are base fees and per transaction fees to consider as well as others. Each credit card merchant has their own unique fee setup, so be sure to thoroughly compare them.

Be certain to include the value of your time when doing the comparison of fees. If you are able to stop the duplicate entry of data, it will be worth a great deal to you! Don’t minimize the amount of time you spend doing double data-entry over the course of a month.

Something You Need To Know

Bookkeepers go crazy each month trying to reconcile their credit card transactions due to the fact that the credit card merchant has deducted their fees from each transaction. Make it a point to ask the credit card merchant if they will simply charge your bank account for all of your fees once per month, instead of on a transaction-by-transaction basis. Many of them will do this for you, but you have to ask them first – they don’t do it automatically. If you can get this accomplished, your bookkeeper may even give you a hug!

Processing your credit card transactions within your bookkeeping software has helped many businesses streamline their data flow and become much more efficient. What can it do for yours?

Scott Gregory is the President of Bond Technology Ltd.
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