When starting up your very own business for the first time, there are a lot of factors to consider. One of the biggest is that when customers make a purchase from you using their credit cards, you need to have a system in place to process their payments. That’s where a payment processor comes in.
So, what exactly is a payment processor?
A payment processor is essentially a third party company that handles your transactions and that are made in your business, so that customers can make payments with their debit or credit cards. The company takes the customer’s card information and passes it on to the customer’s bank as well as your business’ bank, and it ensures that there are sufficient funds on the customer’s card to process the payment and approve it.
The payment processor also ensures that the card information that the customer is providing is correct. This is done as a security measure and in order to make sure that the customer’s card is not being used in a fraudulent way, so that the card holder is not charged for payments that they did not make. Another security measure that payment processors provide is ensuring that the charge being made to a customer’s card is from a legitimate business that is who it claims to be.
Payment processors play a major role in ensuring that a business is fully able to function, and that they are able to accept payments from their patrons in order to keep the business running.
Another important aspect of the payment processor is its timeliness. What the company does happens in a matter of seconds, when a customer swipes or inserts his or her card into the card reader, or inputs their credit card information if your business is run online. The mere few seconds that a confirmation takes to load or that a customer is told to “please wait” are when a payment processor does its job, meaning that the exchange of information is nearly instant.
Some payment processor companies are able to work across multiple platforms; a business could use the same company for multiple services. This means that your business could sign up with one company, and be able to utilize it at an in-person location, on a website, and on customers’ mobile phones as well.
Some payment processor companies, such as Square and Cayan, even give the added option of providing a business with a mobile reader that can be attached to a phone or tablet to be used with their company’s services. These companies oftentimes develop apps that can be installed on phones or tablets in order to be paired for use with their mobile readers in the most efficient way possible. This makes interactions between the customer and your business run even more quickly and smoothly than they would before, and ensures that the customer is receiving consistency in service and processing speed across any platform they decide to use when shopping with your business.