I'm a consultant, and not surprisingly, having the ability to process credit cards anywhere is absolutely beneficial to my business, especially when our staff is able to capture funds on their BlackBerry or iPhone while in the field. For many of you, whether you are an Arts & Crafts Vendor, Plumber, Livery Driver, or Caterer, you likely have very similar needs.
If your search for a mobile processing solution is making you a bit cross-eyed, then I have some information that might help you find some clarity. For some of you who read this, you can be processing credit cards on your phone in a matter of moments, without so much as having to complete a form or making a phone call.
How it Works
One aspect of selecting an appropriate solution is by first understanding the concept that actually allows us to process a credit card on our mobile phones. When you make an online purchase on your PC via your favorite browser, chances are that it's secure and encrypted through what's called "SSL" (Secured Socket Layer). When your credit card information is processed, it's done in such a way that outside parties can't intercept the information. This "SSL" feature is also used on smart-phones as well your PC.
Also, much like your PC, when your credit card information is entered for a secured transaction, this request gets routed to a "Payment Gateway" that also supports "SSL." The purpose of this gateway is simply to route your credit card request to the companies merchant account provider that you are doing business with. As part of this process, the gateway makes sure the card is valid, before approving the transaction and charging your card. As your smart-phone already has a connection to the internet, and it already supports SSL, the real magic is done with the gateway.
Basically, the transaction goes something like this:
- Credit Card Information is entered on either your PC, or smart-phone application
- Once Entered, the payment gateway validates the request and passes the information to the companys Merchant Account Provider
- Once settled, the Merchant Account Processor makes a deposit in the companies bank account.
A Merchant Account Provider is the party that is responsible for the validity of the transaction and ultimately depositing the funds into the company bank account. If you currently accept credit cards, and you do so via a credit card terminal, the Merchant Account provider is basically the company on the other end of your line.
The most popular payment gateway is Authorize.Net and it's for good reason. Authorize.Net interfaces not only with virtually every Merchant Account Provider, but is also the most popular solution for web shopping cart integration. Add to that, you can process cards directly from their web application which is awesome if you want to take phone orders. And finally, it's the most widely supported payment gateway for mobile phone solutions.
PayPal Web Payments Pro
Many Mobile Phone Credit Card Processing solutions also support PayPals "Web Payments Pro" product. Don't confuse this with your standard PayPal Service. Expect to pay about $30 per month for the same functionality as a traditional Merchant Account and Authorize.Net payment gateway. While it may be more expensive, you'll still find mobile phone applications that support "Web Payments Pro" as an additional gateway.
Proprietary Gateways with Merchant Accounts
More often than not, most any 'FREE' mobile phone credit card processing application with be a bundle of a Merchant Account with a Proprietary Gateway. Basically, offerings like this will promote a FREE mobile phone credit card processing application, but sadly, it will only work with their own payment gateway. The problem is, that if your needs change, and you need to integrate a payment system with your website, or perhaps take phone orders, you might find yourself paying more in the long run.
At any rate, if you are considering a Free mobile application with proprietary gateway, just make sure to ask them about converting to a different plan later.
Application Sources
