Adding Mobile Credit Card Readers to Your Business - dummies

By Shannon Belew, Joel Elad

Do you want to be able to accept credit cards virtually anywhere you have an Internet connection and a smartphone or compatible tablet device? Install a mobile credit card reader, which plugs into your smart device and works with an installed app that handles the credit card processing with the bank instantly, removing the need for a dedicated credit card terminal.

The first question most people ask is, “Why would I need a mobile credit card reader if I have an online business?” Here are some possible reasons why this device could help you:

  • Accept credit cards anywhere. Some online businesses add an offline component to their sales, whether it’s setting up at the local antique mall, trade show, convention, bricks-and-mortar store, or other physical location.

    When you use a mobile credit card reader at these locations, you expand your payment options with walk-up customers, which also expands your opportunity to make a sale at those locations. The money is deposited into your account, just like it is when you make a sale online.

  • Replace your dedicated credit card terminal. In some cases, your business may be paying to keep a dedicated credit card terminal at your office in case you get a phone or mail order. By replacing a dedicated terminal (which comes with yearly or monthly fees, statement fees, equipment fees, and more) with a mobile credit card reader, you pay a fee only per transaction, which can be cheaper for lower volumes of credit card transactions.

    Check your existing fee structure and past years’ fees versus any new system before changing your equipment.

  • Have multiple checkout points. As smartphone use increases, the chances of your employees, partners, and helpers having a compatible device for these readers goes up, which means you can offer two or more checkout options instead of a single payment line at a physical location.

    Some stores use mobile credit card readers with iPads to create mobile cash registers; they can process customer orders while the customers are standing in line to pay and leave. These readers can be configured with the app so that the money is deposited in your business, not the employee’s account. Most systems allow for multiple devices to be tied to one business account.

  • You can process credit cards without the reader. If your mobile credit card reader is broken or not picking up the information from the magnetic strip, you can still use the payment app to type in the credit card information and run the transaction instantly. Some readers now go further and allow you to take pictures of a customers’ check or access their online payment accounts such as PayPal.

Some of the leading mobile credit card readers can be found here:

  • Square: As of this writing, Square is the most recognized mobile credit card reader. You can find them in physical stores such as the Apple Store, and they plug into any iPhone, iPad, and most Android devices. The Square app allows you to run individual credit card transactions, create invoices, or turn an iPad into a cash register with payment buttons tied to your inventory items, making it easier to ring up someone and accurately record what is being sold.

    Square will ask you to configure an account and deposit any collected funds into your bank account the next business day, subject to some limitations.

  • PayPal Here: The popular online payment company PayPal has developed a mobile credit card reader that also plugs into most iOS and Android devices. They offer a cash register option for iPad users, and accept customer’s Visa, MasterCard, Discover, and American Express cards.

    Funds collected are immediately deposited into the seller’s PayPal account, subject to some limitations depending on the type of transaction.

  • Intuit GoPayment: The maker of popular accounting software QuickBooks has developed a mobile credit card reader that plugs into customer’s iOS or Android devices as well. The GoPayment device and app syncs automatically with users’ QuickBooks and Intuit Point of Sale products to help small businesses or entrepreneurs manage their sales.

    They offer both a pay-as-you-swipe plan, in which you pay a percentage of each sales transaction, and a monthly subscription model with lower per-sale percentage fees.

After you determine which app you want, install and configure it on your device. Then order the physical card reader (a process that is usually automatic when you install the app) and wait for it to arrive. You can always key in manual entries until the reader arrives.

Then when you are ready to process a sale, proceed as follows:

  1. Start the app, insert the reader into your microphone jack, and log into your account through the app.

  2. Enter the amount of the sale.

    In most cases, the app will prompt you to enter the sales amount, as shown in the figure. Or if you’ve configured buttons to correspond to inventory items, you simply click the buttons matching the items the customer wants to buy, and the total is updated automatically.


  3. Swipe the credit card in the mobile reader.

    You may need to click a button such as Charge. In some cases, the reader requires you to swipe the card up to three times to properly read the information. You also have the option to manually enter the credit card number or use your phone to photograph and scan the physical card.

  4. Enter the CSC and the customer’s billing zip code.

    The CSC (card security code) appears on the back of all cards except American Express, which has the CSC on the front.

  5. Wait for the card transaction to come back accepted or rejected from the bank.

    When the transaction comes back as accepted, the app displays a blank screen for the customer to use to sign his or her name as a record of the transaction.

  6. Present the customer with your device so that he or she can sign for the transaction.

    An example of a signed screen is shown in the figure.


  7. Offer the customer a receipt for the transaction.

    Many readers, such as Square, offer to text a receipt texted to the customer’s mobile phone via SMS, or send an e-mail receipt. If the customer has used the payment service in the past, the options are prefilled with the person’s phone number or e-mail. You or the customer can click the appropriate Send button (for text or e-mail) to send the receipt.

The transaction is complete! Repeat as often as possible and watch your sales go up! Don’t forget to take advantage of reports and summary functions to track your mobile credit card sales and compare them to your online sales.