Last editedMar 20223 min read
Merchants taking payments in the real world can still earn benefits from having a credit card machine. There are costs involved with this so it’s important to get the right credit card machine for your needs, wants and budget. With that in mind, here is a guide to choosing the best credit card machine for your small business.
Why have a small business credit card machine?
Cash might not have disappeared from the world. It is, however, definitely not most people’s preferred method of payment. In the real world, most people today will typically pay by credit card (or debit card) if only out of habit. This means the majority of merchants taking real-world payments are likely to benefit from having a credit card machine.
Why not have a small business credit card machine?
If you mainly or only take payments online, the cost of a credit card machine for small business may not be justified by its benefits. This is why some merchants now only accept E-Wallets and/or Direct Debits. Modern customers are now generally comfortable with both of these options.
Thanks to Instant Bank Pay from GoCardless, online merchants can now take Direct Debit payments with immediate confirmation. Merchants can also use Direct Debits to collect invoices (both one-off and recurring), instalments and subscriptions. Payments can be managed either from the GoCardless dashboard or through accounting software.
One key benefit of Direct Debits is that it is a pull-based system. This means that you and your customer agree on a payment date and payment is taken automatically. This vastly reduces friction and the time (and stress) of financial administration.
How to choose a small business credit card machine
If you are looking for the best credit card machine for your small business, there are seven key areas you need to check. These are:
Hardware (including battery life)
Credit card machines for small businesses can be sold for use on a pay-as-you-go basis or provided as part of a contract. Pay-as-you-go options are flexible but transaction fees can be much higher than with a contract. For this reason, they tend to be best suited to merchants who anticipate low payment volumes.
When you use a small business credit card machine, an acquirer bank essentially collects the payments on your behalf. They deduct any transaction fees then pay the rest to you. Some acquirers may do this much more quickly than others. It’s strongly advisable to make sure your acquirer’s payout schedule is compatible with your cash-flow situation.
You need to ensure you choose a small business card reader that can physically stand up to whatever you want to do with it. Never expect your customers to treat it gently, even if you’re supervising them. Smaller, lighter card readers can be great for occasional payments. If you’re using them regularly, however, they need to be robust.
It’s also important to check if your card reader needs to be plugged into the mains or whether it works off a battery. If it can work off a battery, it’s advisable to check the battery life. Keep in mind, however, that battery-life guidelines are exactly that, guidelines. In the real world, the battery life of any device will be largely determined by the way it's used.
Continually switching a device on and off will generally drain a battery more than leaving it on standby. Also, cold temperatures will seriously reduce the life of any battery, no matter how powerful it is.
If you’re planning to use your small business credit card machine in a fixed location, you may want a physical internet connection. If not, or even if you just want extra flexibility, you’ll need a device with some form of connectivity, such as WiFi or Bluetooth and/or its own SIM card.
Any small business credit card machine sold by a mainstream provider in the UK can be assumed to be secure. It is, however, advisable to check the specific details of the security it offers. Also, remember that a lot of security depends on responsible usage.
Many small business credit card machines have some level of value-add functionality. For example, they may offer analytics on your usage.
Never underestimate the value of an effective and easily-reachable customer service team.
We can help
If you’re interested in finding out more about the best credit card machines for small businesses, then get in touch with our financial experts. Find out how GoCardless can help you with ad hoc payments or recurring payments.