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Getting paid is great, especially in an economic climate where late payments for invoices are irritatingly common. Giving your clients another – and arguably simpler – way to pay is going to be helpful in curtailing this problem. Handling cash can also be a pain for those in retail – and in an increasingly cashless society card payments are a must. This is why, now the technology is affordable and readily available, more and more freelancers are taking card payments.
These days it’s all about using smartphones and tablets as a point-of-sale device – all the providers offer dongles, widgets or doohickeys that turn your device into a card reader. The various providers offer essentially the same service, with many sharing the same features – picking the best can be a time-consuming task. Here’s a look at what all the major providers offer:
Wireless readers with chip and pin security
Customisable product inventory
Accepts all major credit and debit cards
Issues refunds and electronic receipts
Options to add discounts
Separate employee accounts
All the options are easy to set up, and it won’t cause any problems if you’re often on the move. You can collect payments wherever an Internet connection is available.
There are some disparities between providers, so here’s a rundown of what the main services offer.
PayPal offers a fairly well-known, trusted brand to attach yourself to. While PayPal might not be in everyone’s good books, it is the most well-known company offering this service. Familiarity can breed reassurance, especially when you’re asking customers to do something they’re not used to.
In terms of cost, the reader itself will set you back £99 (with free delivery). You’ll also have a fee of 2.75% on every payment taken through the reader or through PayPal Checkin (an associated app that allows customers to pay up to £150 with their PayPal account from their phone). If you have to swipe the card or manually enter the details it’ll be 3.4% plus 20p per purchase. Money will go into your PayPal account instantly, and then withdrawal to your bank can be as quick as within two hours from there.
One unique feature that PayPal offers is that you can add your business to the ‘Local’ section of the PayPal app. This means people can see who accepts payments from the service in their immediate area. It’s a nice bit of free advertising that’s well-targeted due to its localisation. Obviously this will have more benefits for some types of business rather than others.
While offering the reader at the same price as PayPal, the fee for transactions differs. iZettle offer a sliding scale so that the more money you take the less you pay in fees. Based on monthly income, between £0-55 the fee is 2.75%, which slowly decreases down to 1.5% when you hit £193+. The process doesn’t mean you’ll instantly be charged less though. Everything will be hit with the basic 2.75%, and then you’ll receive cashback based on deductions the following month. So, depending on your income, iZettle can be the cheapest of card transaction providers. In regards to swipes and manual entering, the fee is 3.5% plus 10p, which is better than PayPal.
iZettle also has a nice system for products catalogue too. Rather than just having a simple list of everything you sell, iZettle allows you to sort everything into categories and break individual items down into sizes. For example, the single latte item will give options for ‘small’, ‘medium, or ‘large’.
Getting your money is a bit slow though, with a wait of up to 3 business days until you see the income in your bank. Bear this in mind if this kind of delay will have serious consequences on your cashflow.
Payleven is much the same, with its 2.75% fee for every transaction, although they do have a minimum transaction of £1. For most, this probably won’t cause too much of a problem, but for anyone wanting to keep all their records electronic it might offer some small annoyance. The wait to get your hands on the money is even longer than iZettle though – Payleven does a weekly payout on a Friday with a five day wait from then to have your money in your account. This means you’ll end up waiting 11 days for some payments to come through.
Their reader is a little cheaper at £59.99. They also offer a receipt printer which, while handy for some, comes in at rather extravagant £329 (mercifully, they throw a card reader in too).
There are other mobile card payment providers on the market too, such as Intuit Pay and SumUp, however their offerings run along much the same lines with differences that, for the most part, are hardly noticeable (although SumUp runs through apps alone with no reader). Each provider offers the same security and basic features, and nearly all offer the same flat transaction fee of 2.75%. This is still a nascent market, and more entrants are almost guaranteed in the near future.
In the meantime, enjoy being able to give your customers an extra way to pay!
Payment on account is not something that is widely known about among people who have never been part of the Self Assessment system. Learn more now!