How wireless merchant accounts work

Wireless merchant accounts let you make sales just about anywhere

By Steven Bryan

By using wireless technology, you can accept credit cards in even the most awkward of places. Sometimes, when the customer can't come to your store, you can use wireless technology to bring the store to the customer. A wireless merchant account lets you accept credit cards virtually anywhere in the world, making it possible to carry a cash register in the palm of your hand.

Going wireless
Setting up a wireless merchant account adds an additional degree of mobility to your sales. Using a portable credit card scanner, you can make sales at trade shows, conventions or even at a client's office. As a transaction is being processed, all the relevant information about the sale is stored inside the scanner; that data also can be downloaded onto your desktop or laptop computer for your records.

The first, and most important step, in going wireless is setting up a merchant account with a financial institution, also known as an "acquiring bank." Like applying for a credit card, you can set up a merchant account over the phone or by submitting an online application. If approved, the proceeds from your credit card sales will be deposited into this account.

Fees and surcharges
As a wireless merchant, a small portion of every transaction will automatically be deducted from your account. These fees include:

• A monthly maintenance fee.
• A per-transaction fee, also known as a "swipe fee," which averages about 25 cents.
• The "interchange fee," which goes directly to the credit card company.
• Wireless network charge. This is a monthly fee deducted from your merchant account.

Wireless equipment
For wireless transactions, you will need a compact credit card scanner that can access a secure wireless network approved by your acquiring bank. The charge account data is transmitted first to your bank and then to the bank that issued the customer's credit card.

When doing anything through a wireless connection, it's always important to make sure that both your equipment and network use good encryption and security; hackers and data thieves are always on the lookout for unsecured networks.

Useful in many industries
When it comes to credit card transactions, wireless technology can be used in a variety of ways. If you've purchased food or drinks on an airplane recently, the flight attendants used a wireless credit card scanner if you charged your meal.

Other businesses that could benefit from a wireless merchant account include:

• Food delivery, such as pizza
• Package and document delivery
• Food, beverage and souvenir vendors at athletic fields
• Moving companies
• Construction contractors

 Article by Steven Bryan

Published: October 12, 2009