An Expert's Advice on Payment Gateways for Small Business Owners.
Merchants have many responsibilities to consider when it comes to their small business. One of the most important aspects is the decision to implement a payment gateway for their company. Payment gateways enable organizations to authorize credit card transactions for both ecommerce and brick-and-mortar enterprises. Business owners must understand all the necessary elements of these tools prior to making their final selection. By choosing a comprehensive and efficient system, merchants can save themselves from headaches caused by payment gateways and point-of-sale problems. This is an expert's advice on payment gateways for small-business owners:
Focus on security
It's common for customers to worry about the safety of their personal information when using a debit or credit card to make an online or in-store purchase. It is the merchant's obligation to provide a secure payment gateway that protects this sensitive data from external attacks and internal errors, both of which could lead to a serious data breach. There are two major security measures small-business owners should use to ensure the preservation of consumer data: Payment Card Industry Data Security Standards (PCI-DSS) compliance and EMV (chip card) adherence.
The PCI regularly updates its standards to include new safety practices for current credit and debit card security threats. The standards give businesses a comprehensive outline of actions they can take to safely store, process and transmit this information. While full compliance means following all of PCI's standards, small-business owners can take initial responsibility by adhering to 12 basic guidelines for consumer data protection.1 They are as follows:
- Install and maintain a firewall configuration to protect cardholder data.
- Do not use vendor-supplied defaults for system passwords and other security parameters.
- Protect stored cardholder data.
- Encrypt transmission of cardholder data across open, public networks.
- Protect all systems against malware and regularly update antivirus software or programs.
- Develop and maintain secure systems and applications.
- Restrict access to cardholder data by business need to know.
- Identify and authenticate access to system components.
- Restrict physical access to cardholder data.
- Track and monitor all access to network resources and cardholder data.
- Regularly test security systems and processes.
- Maintain a policy that addresses information security for all personnel.
Merchants should also consider a EMV-compliant payment gateway. In 2015, credit card companies began distributing new cards with an EMV - Europay, Mastercard, Visa - chip, which offers greater protection from hackers duplicating customer information and making fraudulent purchases. To by fully compliant, business owners need to implement a point of sale system that can read the chip, holding the card in the payment device or terminal for the duration of the transaction.
These safety precautions are not required by any means, but companies would benefit from adhering to both PCI and EMV standards. Going beyond the bare minimum can have many advantages for businesses.2 These additional layers of security make organizations seem more trustworthy to clients and can increase overall satisfaction. Furthermore, small-business owners can avoid costly penalties that come with fraudulent transactions if they're not compliant.
Pay attention to contract length
In their search for the right payment gateway, small-business owners will encounter many options. Software and hardware providers want merchants to use their technology for a certain period of time, so it's crucial for company leaders to be cognizant of the required contract length prior to selecting a system.3 Failing to do so could result in businesses being locked into an agreement they're not comfortable with. While some vendors may make it necessary for business owners to sign up for a couple of years, others operate on more of a subscription basis. Each option has its pros and cons, which merchants should be familiar with to avoid unhappiness with their final decision.
Don't forget about fees
In addition to the potential for a required contract length, it's common for payment gateway providers to charge fees on a regular basis. Whether it's monthly usage charges or per-transaction costs, small-business owners must look closely at these elements in their search for an efficient system.4 While a seemingly small transaction charge may not sound like much at the beginning, it can add up over time. Merchants may end up having to pay more than they may have originally budgeted for. Business owners and leaders should also pay attention to the costs of renting or leasing the equipment. Both are options provided by third-party vendors, but small-business owners should factor in which choice is most beneficial for theirs in the long run. By creating a budget before beginning the payment gateway search, business owners and leaders can avoid going over the amount they've allocated for the technology.
Be mindful of ease of integration
Merchants have to look at payment gateways in regards to their eCommerce business as well. Payment processing will occur on the servers of the third-party provider of the gateway technology, so the action will have to be integrated with the company's website itself.5 It's important for small-business owners to find a vendor that offers easy-to-integrate software to make the transaction process that much easier for their operation and their consumers. Most often, this practice comes in the form of a redirect to the payment processor's website to enter credit and debit card information for purchasing. The business itself then gets the customer back once the transaction is complete.
The simpler this process is, the better. An efficient payment gateway will provide ease of integration and overall use.
Small-business owners already have a multitude of obligations to keep in mind when running their companies. However, finding the right payment gateway provider should be a large focus since customers want to utilize their credit and debit cards for easy transactions. The expert advice in this situation is to understand the various factors that go into this search, including security, contract length, ease of integration and cost and fees. Considering these essential elements, merchants can find the best payment gateway for their ecommerce or brick-and-mortar organization.
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