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Overview of Payment Processing Methods |
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Overview of Payment Processing Methods |
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Overview of Payment Processing Methods
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Overview of Payment Processing Methods |
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Overview of Payment Processing Methods |
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This section gives you an overview of each method and factors to consider for each. It will help you decide what payment methods work best for your business structure.
Cash/Check
Accepting cash or check from your customers is the most manual method of taking payments. The system does not do automatic processing with this choice, so it is up to the business to make sure payment is made on a reservation. Simply put, selecting this payment method for your products allows your customers to make a reservation without paying. For this reason, this method is generally not recommended for online bookings.
Factors to Consider:
| ▪ | Expect a 10-15 day processing time for checks. This means that when a booking is made, it must be held in the system until the check is received and cleared through the bank. If something does happen, such as the check does not clear the bank, then you will have to cancel that booking and may or may not have enough time to re-book the reservation. |
| ▪ | Asking for a money order or cashier’s check will ensure that you receive payment and will not have the issue of a check that doesn’t clear the bank. |
| ▪ | Banks often “hold” checks for up to 7 days before it can become available to your business in order to ensure that the money is available. |
PayPal
Over the past several years, accepting payments using PayPal has become a popular option for small and large businesses alike. It was created as an electronic transfer option between businesses and individuals that doesn’t require creating a merchant account. To set up a PayPal as a payment option for your customers, you first need to create an account with PayPal. It is free and can be set up in just a few minutes. After set up, you are able to accept payments from other PayPal users. You can also upgrade to a business account and have the ability to accept credit card payments from non-PayPal users. In this case, PayPal essentially becomes a merchant account for you.
Factors to Consider:
| ▪ | PayPal charges a small fee for transactions between PayPal users and a larger fee for credit card payments through PayPal. If your business has a high volume of credit card transactions, it is recommended to compare the merchant account rates with PayPal rates. |
| ▪ | Payments get deposited into your PayPal account, so you need to transfer the funds into your bank. Until the funds become available from PayPal to transfer to your account, PayPal is earning the interest on your businesses money. |
| ▪ | PayPal doesn’t keep a credit card on file, so if there is an instance where you need to charge an outstanding deposit, you will have to reach out to the customer to initiate the transfer. If you had credit card processing set up, you would be able to charge the balance due. |
| ▪ | Refunds cannot be processed through the system and need to be processed through PayPal. |
Credit Cards
Credit Card Processing
Accepting credit cards is the recommended option for most businesses for many reasons. Using this option gives your business the ability to receive payment right away. It will easily automate the booking process and not confirm a reservation until the customer provides a valid credit card. This option is great for business with many bookings. The system has the option to keep the credit card on file, so businesses can charge the remaining balance of a booking easily. Processing credit cards require setting up a merchant account for your business. A merchant account acts as a connection between the credit card company and your bank account. Banks as well as specialized merchant account companies offer this service.
Factors to Consider:
| ▪ | Specialized merchant account providers (or ISOs) often offer better terms than banks and are usually more familiar with online payments and credit card terminals. |
| ▪ | Credit card processing can be costly for a business. Merchant account companies often charge a monthly fee, usually $25-35. In addition to the monthly fee, your business will incur a transaction fee on all charges, this is usually a percentage of the charge and sometimes a percentage and a fixed per fee transaction, typically $0.30. |
| ▪ | Transaction fees vary per merchant providers as well as other factors such as your industry and sales volume. It is not uncommon to pay 2.5%-3.5% of the total sale. |
| ▪ | When deciding on a merchant account provider, it is best to shop around. There are many great companies out there, but it is important to consider your unique business needs and find a provider that best matches. In addition, you want to make sure the chosen provider is compatible with WebReserv. See Choosing a Merchant Account Provider for more information. |
Credit Card Capture
As an alternative to credit card processing, WebReserv allows business to capture credit card information for processing. With this option, credit cards are not processed automatically through the system, but instead the information is captured for a business to process through their own terminal. This option works well for businesses that have an established merchant account provider that currently is not compatible with our system.
For more information. . .
Setup up for Cash/Check payments
Choosing a Merchant Account Provider
Setup for credit card processing