Finance

Payments Using Plastic Money on the Rise- Accept Card Payments or Suffer.

The usage of cash for purchasing goods has been seen at a downfall over the past decade. To keep such an awkward amount of cash in your pocket while going to make a deal or purchase a particular item doesn’t seem feasible. In the USA, cash payment methods have decreased over time, and the new electronic payment methods are on the rise.

The main problem arises for business people involved in small or medium enterprises, for they generally accept in-hand payments. Plentiful business people prefer cash payment and deny card/electronic payments to save money on transaction charges. Many retailers and service providers also fear a fraudulent effort made by the customer to start accepting card payments.

Card Payments

This very fear of deception has facilitated card readers as a payment method, a questionable step for retailers and service providers. But according to reports, it is advised that business people should accept card payments or watch their customers leave. This very threat that an enterprise might lose consumers if it fails to enable a particular payment method should be a wake-up call for all those who own a small or medium-sized business.

While it is true that it will be a bit of a loss for small or medium-sized business owners, accept card payments and pay the transaction fee to the credit card companies, but it is still seen as a better alternative than losing customers. Small business owners should consider this step as a form of investment for the blooming of their business. It might be heavy on the pocket at first but will get you better results over time.

Companies like SumUp have a low transaction rate (as low as 2.65% per transaction). They are of great help to small and medium-sized business owners, as the company is an EMV card reader technology provider. SumUp is, as of right now, Europe’s #1 fastest growing company and a renowned leader of the European MOPS market.

It has come up with the technology to help small /medium-sized business owners process card payments with ease. SumUp now has an office located in Boulder, Colorado, and has now officially branched out into America’s United States. Market With a successful enterprise set up in Europe and South America (especially Brazil), the company aims to make its presence felt in America and manifest its vision of becoming the world’s first greatest card acceptance brand.

While it may seem a bit complex, there are only 3 known card readers you need to familiarize yourself with. Mentioned below is a brief of each type of card reader and how it is used.

Swipe Card Reader: This is one of the basic types of a card reader, which requires the person to swipe their card alongside the magnetic strip present on their card. This type is straightforward, yet it can easily be used and replicated by fraudsters.

Only after the card’s physical swiping will the money be deducted from the individuals’ bank account and be transferred to the merchant’s account. This type of card reader may soon be out of fashion due to newly designed card readers, but it still facilitates a majority of payments made to dates.

EMV card reader:

This card reader has seen an uprising in its usage over the past few years, as it guarantees easy and safe transactions. The company SumUp has come up with such an EMV card reader that works with a Bluetooth-based interface. EMV stands for “Europay MasterCard Visa” and has emerged as a profound payment method worldwide.

EMV technology works on the principle of chips; the card will have an encrypted chip planted on it, which will contain the required banking data. This data will be shared with the card reader when the user plans to make a purchase/payment.

An EMV card reader is a fraudulent free method, as, without the presence of the card, you cannot make a payment. Fraud for card users is only possible when the card is not present as an online transaction or giving your card details over the phone.

NFC Reader:

It is an advanced type of payment method; NFC stands for “Near Field Communication.” It is basically a payment method that requires less-contact because it works on the principle of RFID (Radio Frequency Identification). NFC-equipped cards, smartphones, and other smart devices can make payments via NFC readers or other payment processing devices.

How does it work? It is pretty simple, NFC-based cardholders can pay a significant amount to a merchant by simply ‘Tapping’ their chip-embedded card on the NFC card reader. The amount will have been transferred from the customer’s account to the merchant’s account.

NFC has become an emerging payment method as it is fast and easy; it is also becoming a trend among smartphone users. All you need to do is download the required app, select your card of choice, and put in its details, after which you can make payments through any NFC-equipped device. This payment method is equally secure as that of EMV technology.

The Liability Shift-

A liability shift was implemented in October 2015, which mentioned that the liability would shift to the party that had not yet adopted chip technology in the case of a fraudulent scenario.

To help you understand the concept better, we bring forward 3 scenarios:

1st Scenario: A magnetic stripe card made a counterfeit payment on a swiping machine. In such cases, the customer is held liable for fraud.

2nd Scenario: A counterfeit payment is made using a chip embedded card on a traditional magnetic stripe only terminal. In such a case, the liability shifts to the merchant as the cardholder had spent on chip technology for a safer transaction while the merchant had not.

3rd Scenario: A counterfeit payment is made using a chip embedded card on a chip-based terminal. In such a case, the merchant is off the hook, while the liability will shift to the customer.

These 3 scenarios show us that investing in chip technology is only beneficial for small and medium-sized businesses. Because investing in chip technology by both parties (buyers & sellers), will lead to an overall decrease in in-store counterfeit fraud.

SumUp is one such company that will help you get your hands on chip-based technology, which can be used for multiple terminals. SumUp provides EMV card reader technology that is chip-based and even provides light and small card readers for those mobile businessmen who are always on their feet.

About author

I work for WideInfo and I love writing on my blog every day with huge new information to help my readers. Fashion is my hobby and eating food is my life. Social Media is my blood to connect my family and friends.
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