The Importance of Accepting Credit Cards in Your Business

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Friday, 25 July 2008

Home / Business / E-Commerce

By:Wendy Wood

When you set up your gift basket business, you are, of course, faced with numerous questions, doubts, and options. One of them, and an important one at that, is whether to accept credit cards.

Whether you have your business in a retail outlet or online or a combination of both, credit cards are the norm these days. Of course, there are still some customers who prefer to pay using cash or debit but most people have a credit card and use one these days. And, if you assume that you will have enough traffic flow by just catering to the non-credit card community, you might be right but you might also be turning off potentially high-valued customers, and those who could give you repeat business. By not accepting credit cards, the word gets around too about your limitation in that respect and it may turn some would-be customers away.

In 1996 itself, credit card payments accounted for 88% of the $1.25 billion online transaction revenue, according to Jupiter Communications, which is an electronic commerce research firm in New York. And, their forecast is that credit card payments will account for over 50% of revenue in payments over the next millennium.

So, accepting credit cards these days is extremely important. It helps to attract more customers to your business and it does it in two ways:
1. By lending credibility to your business
It is the common conception that only reputable and credible companies accept credit cards.
2. By providing a safe buying environment
All web pages that accept credit card payments have encryption features and they are secured. Further, when making a purchase online via credit card, customers are liable to credit card companies for only the first $50 in the case of fraud.

You have to be aware though that the fees for accepting credit card payments online are higher than in situations when a physical card is present. This is due to the nature of Internet transactions: there is no customer to sign for the purchase nor is there a physical card. This type of transaction-"Card Not Present" or "Mail Order/Telephone Order" transaction is categorized as higher risk and therefore comes with a higher fee. But, in the long run, the higher fee is well worth it. It will result in a larger customer base and one that is more qualified in terms of the money they are willing to spend. This will eventually lead to higher turnover for you.

You have to just bite the bullet when it comes to incurring the charges to set up a merchant account to accept credit cards but it is better to run the whole gamut and set up everything right as well. So, make sure that you also use a real-time authorization and processing service such as CyberCash.

Accept credit cards and be counted in as a merchant in step with the times.

Article Source: http://www.dailynewarticles.com

Wendy Wood is the owner of an online gift basket directory. Sign up for free Gift Basket Business Tips http://www.seekgiftbaskets.com/gift-business-tips.htm