Five Credit Card Mobile Apps that Help Small Businesses

David Sung | March 9, 2012

A few days ago Business Insider reported on a study conducted by Intuit that found a shocking 55% of the nation’s 27 million small businesses do not accept credit cards. Considering the extensive costs that accompany being a lean-mean-swiping machine, this figure is not surprising. Small businesses that sign up with credit card vendors can expect expenses for equipment rental, gateway fees, and monthly and statement fees, just to name a few. However, companies that fail to accept credit card transactions face a double-edged sword.

The same Intuit study found that businesses that do not accept “plastic” lose, on average, $7,000 a year in sales, for a grand total of $100 billion in sales lost annually. Naturally, we found it appropriate to commission our own little “study” – well, review, of the five best mobile credit card apps to help you capture every penny. To qualify the list, our research team chose five products that have no monthly, no start-up, no software and no gateway fees. We understand how unfriendly and inconvenient fees can be to your bottom line. All products on the list accept Visa, MasterCard, Discover and American Express.

The Square

The Square can really be the small business owners’ everyday best friend. The Square is the only product we found that doesn't require a merchant account. When a customer swipes a card, a merchant only pays a 2.75% discount rate, compared to the standard method that requires a 3.5% discount rate and a $0.15 transaction charge. As an added bonus, The Square will even mail you their card reader for free. It functions on iPhone, iPad and Android platforms and advertises that your funds from sales will be available by the next day. For larger purchases, merchants can expect a slightly longer time frame for transactions to be processed for verification purposes.

MerchantWARE Mobile

As the name implies, you are required to have a merchant account with MerchantWARE, but fortunately they ensure that your funds for all sales will be available by end of each business day. Any transaction will be charged a $0.21 transaction fee, with swiped transactions costing 1.69% and keyed-in transactions costing 2.19%. This program is supported on iOS, Android and Blackberry. However, MerchantWARE’s card scanner will cost you about $129 to purchase. Compared to how much you stand to lose, though, that might be an investment worth making.

Intuit GoPayment

Intuit also has an extremely viable option with very few objections. With an iOS and Android compatible platform, the card reader is free when you start an account, and funds are processed within 2-3 business days of the sale. While Intuit’s discount rates are on the higher end of the spectrum, 2. 7% swipe fee and 3.7% keyed-in fee, GoPayment does not charge its merchants a transaction fee for either. You must have a merchant account with Intuit.

This new and polished platform seems to be a bit overlooked, despite its competitive offerings. Moblized functions on iOS, Android and Blackberry systems. The card reader is free, with 2-3 business days required to process transactions. Moblized has a $0.19 transaction fee, swipe fee of 2.7%, and a keyed-in fee of 3.5%. The platform does require a merchant account as well.

Pay Anywhere

Pay Anywhere is holding its own in the credit card mobile app market. Similar to The Square, Pay Anywhere does not charge a transaction fee for swiped transactions, only a 2.69% discount charge. However, keyed-in transactions will run you 3.49% with a $0.19 transaction charge.  A merchant account is required, and funds are typically deposited within two days. Like Mobilized and MerchantWARE Mobile, Pay Anywhere operates with iOS, Blackberry and Android.

Ultimately, each one of these platforms has different benefits and limitations, but they each stand to open up a new channel for collecting credit card sales. It doesn’t matter if you are a sole proprietorship or a company with a sales team, exploring the option of mobile credit card machines can certainly outweigh the costs of not doing so. Credit cards offer a valuable convenience factor that is hard to ignore. If you find yourself on the purchasing end of these apps, read this blog post about credit card management.

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