“I don’t need a manual imprinter,” our new client emphatically declared.  She continued, “I’m going to be using your dial pay system and collect funds that way.”  I explained that the credit card imprinter is not a device for accepting credit cards to transfer funds; it is merely a way to prove that a customer authorized a given transaction, and can be invaluable proof in helping to win a chargeback should a customer dispute the authenticity of a charge. 

Years ago, the manual imprinter was the ”It” machine – indispensable in the credit card processing process.  Merchants would ensure that a customer’s credit card number was valid, and then take an imprint of the card.  The slips would then be sent to a bank for eventual payment.

While the merchant account field continues to advance and evolve, the role of the manual imprinter has changed, but the good, old-fashioned knuckle buster retains importance. 

Consider a new merchant who needs a wireless merchant account.  The costs for such an account may be prohibitive because of the expense of the wireless terminal and/or high monthly fees.  A knuckle buster enables the merchant to get an imprint of the card, and then go back to the home office, and key the payment information into a cheaper stationary credit card terminal or virtual terminal.  It also serves the dual purpose of providing a receipt to the customer as he/she receives the imprinted sales slip.  

Of course, there is a risk that the credit card presented was stolen or the card was already “maxed out.”  Still, many merchants feel comfortable with their client base – especially those who sell relatively inexpensive items – and rely on manual imprinters to serve as a conduit towards payment.

All mobile merchants who have face-to-face contact with customers should consider using credit card imprinters – even those who already possess a physical credit card machine.  Although this may seem counterintuitive, think about Murphy’s Law.  Merchants may experience a problem with their terminals (which typically happens when the merchant is most busy), and knuckle busters may be used as a substitute device in an emergency situation.

In addition, consider this “What if”: You’re not able to swipe a customer’s card because the magnetic strip in the back is worn or demagnetized.  While you can key in the customer’s information into the physical credit card terminal, you’re still going to need to protect yourself if the customer later disputes the transaction.  What better way to prove that the credit card was present at the time of sale and that the customer authorized the transaction than by providing the imprinted credit card slip.  Conversely, if you’re unable to share such a slip, you may lose the chargeback even if you’re “in the right.”

Recently, a retail client called and shared her chargeback victory over a customer whose card she had to key into the terminal.  She was very thankful that she purchased and used her knuckle buster – a decision that saved her over $200.  The handy-dandy, affordable knuckle buster (most cost between $20 and $40) can easily save merchants hundreds, if not thousands, of dollars.

Obviously, if you’re an e-commerce or Internet merchant, imprinters are a needless expense.  After all, you don’t have the customer’s card in hand.  But for practically all other merchants, I cannot impress enough the benefits that may be derived from a manual imprinter.  

You’ve performed an exhaustive amount of research, performed your due diligence, and  …. drum roll please … selected the vendor to provide you with a credit card merchant account.  The question then naturally arises, “Just how do I obtain credit card processing capability?”  While the process may slightly differ among merchant account providers, there are common steps to take before a business owner can declare, “We accept credit cards.”

The first task in obtaining a credit card merchant account is to complete an application.  All credit card processing companies require the business owner to sign a contract or an application where the rates should be fully delineated.  It cannot be overemphasized that it behooves you to check that the fee structure quoted is accurately reflected on the form.  There is ample room for error so you must use your attention to detail skills.

The application should not take much time to fill out – less than an hour, assuming your children, if applicable, are not in the same room.  You will provide basic information about yourself and your business.  Most of the fields are self-explanatory although you will have to provide a little more self-disclosure than your name, rank, and serial number.  Specifically, the following information is typically requested: Your name and address, telephone and fax numbers, federal tax id and/or social security number, banking information, etc.

You will also complete a brief business profile, indicating the nature of your business, the number of years that you’ve been in business, the time frame in which your customer will be billed, when you intend to provide the product and/or service, trade references, and other business-related information.

Perhaps the most challenging question posed on the application relates to your intended monthly volume, average ticket, and highest ticket.  The figures that your write may be based on pure conjecture but it is always better to overestimate these amounts than underestimate them.  You should think of the processing volume fields as limits, and in order to prevent funds from being held on a given transaction, you should not exceed the specified amounts/limits.

You’ve now successfully completed the form (you should not have writer’s cramp), and you wonder what’s next in opening a credit card merchant account.  It’s time to gather the supporting documents.  You have to substantiate that you are … well, you … and that you own this business entity.   

You form a small search party to locate your Doing Business As (DBA) certificate or Articles of Incorporation.  This document always seems to be one of the most difficult to uncover.  Sole proprietors may not be required to obtain a business license, and may simply submit any of the following instead: Utility bill in the business name,   sellers permit, copy of the lease, or bank statements showing the DBA/legal name and address.

You’re getting closer to establishing a credit card merchant account but you have to remember that the funds from the transactions have to go somewhere – typically, your local bank.  If you have not done so already, you must open a business check account (or already have an accessible savings account, if you’re a sole proprietor).  Credit card companies will only deposit funds into US-based banks.  Some providers mandate that you have to open a bank account at their acquiring bank.

You’re “to do” list is just about complete.  You then fax, scan or mail the application with the supporting documents to the underwriting department for review.  As competition in the over saturated merchant account field continues to increase, the time it takes to assess an application continues to decrease.  It should only take one or two days before you declare, “I have a credit card merchant account!”

Of course, it’s not a sure bet that your application will be approved.  The underwriters will evaluate the nature of your business, your expected processing amounts, how you plan to accept credit cards (online or offline), and, most importantly, your credit score.  Assuming that your credit rating is favorable and that you run a business that is not on the prohibitive list (e..g, debt collection, telemarketing, etc.), it is highly likely that you will be granted credit card processing capability.

Thinking optimistically, you receive the good news that your application has been approved.  The technical support department then builds the necessary files, and subsequently, you will receive the mechanism in which to accept credit cards, such as a physical credit card machine, Authorize.net gateway, etc.

You’re now a full fledged, proud recipient of a new credit card merchant account.        

I’m fielding more phone calls lately about the Magtek swipe reader.  Consequently, I thought it would be instructive to briefly broach the subject of credit card readers, and focus attention on some of the Magtek readers that are commercially available. 

The best way to introduce the topic is to have you take your credit card in hand and look at the back.  Do you notice the magnetic strip that runs across it?  Many merchants and customers don’t realize that there is a wealth of information encoded in the strip.  Indeed, the strip may contain three tracks of information, including the individual’s name, primary account number, a country code, the card’s expiration date, and other discretionary data.

As a book must be read for it to be meaningful, a credit card’s magnetic strip must be read for the information it contains to be useful and applied.  A credit card swipe reader accomplishes this task.     

If you’ve ever paid for something in person with your credit card it’s almost a certainty the card was swiped through a credit card reader for authorization (and for eventual settlement) by the merchant. The device is used to read the magnetic strip on credit and debit cards and is also known as a magnetic strip(e) or swipe reader. However, a magnetic strip reader is able to read several types of cards that come with a magnetic strip on them, such as certain types of ID cards, and driver’s licenses, etc.

Credit card readers can be connected in several ways such as a keyboard wedge, a serial port (rs-232) or a USB connection. A typical credit card reader will be set up to read tracks one and two, or track two only. PC-connected, keyboard, and portable readers are also commonly used by merchants.

When it comes to credit card readers, one company generally stands out above the rest, and that is Magtek.   The Magtek Company is based in Seal Beach, California, and has been one of the leaders in the electronic payment business since opening its doors in 1972.

Magtek swipe readers are popular among the business world because they are designed to help merchants complete their transactions effectively, easily and securely. They are also compatible with most software applications and PC computers. Moreover, they allow several possible interface configurations to handle the transfer of card information into your system.

Some of their most popular credit card readers include:

Mini Swipe Reader

These economical and compact magnetic card swipe readers are designed to conform to and read ISO (International Organization for Standardization) and AAMVA (American Association of Motor Vehicle Administrators) card formats.  Yes, International credit cards and even driver’s licenses may be read.

The readers are available in various interface options including USB, RS232, Wedge, and TTL and don’t require any external power (except TTLs) to be operated with multiple track configurations. The reader itself doesn’t take up much room at all as it is just a little bit longer than a credit card. It is also very easy to mount as you can fasten it with adhesive strips or by securing it with the embedded threaded mounting hardware.

This Magtek swipe reader can be used with POS software including PC Charge Express and PC Charge Pro. Swiping customer credit cards is simpler and quicker than keying in the data and your transactions will also be eligible for the lower “card present” or “swiped’ discount rates.

MagTek Mini USB Stripe Reader

The Mini USB reader is designed to work with existing software applications developed for keyboard interface. The device is powered by USB which means no external power supply is needed. This compact Magtek swipe reader can work with any computer or terminal that has a USB interface. It also possesses dual and three track capability.

The information is sent as if it was a USB keyboard. Read data can be viewed in various applications such as Windows Notepad without the need for additional drivers and application programming.

This product also comes with a Human Interface Device (HID) Software Interface but a developed or modified application is needed to communicate with this reader. Here, unlike the reader that uses keyboard emulation software interface, data will not be viewable in applications such as Windows Notepad.

Full Size Readers

If you have the room, a full-size reader may be more convenient for all types of card reading applications as the cards can be swiped in the machine both forwards and backwards. These readers are compatible with both the standard RS-232 interface and the traditional keyboard wedge interface. The Magtek full size swipe readers can work easily with PCs and terminals, with up to three tracks of data from magstripe in the extended path to ensure accurate reads.

SureSwipe Reader

The Magtek SureSwipe Reader comes with a USB interface in both HID and Keyboard Emulation modes and can also be reconfigured in the field. The SureSwipe reader has two magnetic heads, one on each side, and is designed to gather three tracks of data from all types of ISO and AAMVA encoded magnetic stripe cards. The reader also comes with a green/red LED indicator that provides you with status of the reader operations.

Authorize.net Compatible Magtek Readers

Authorize.net’s virtual point of sale (VPOS) continues to grow in popularity.  Here, the merchant uses the virtual terminal in conjunction with a card reader to swipe customers’ credit cards.

At present, there are four models of Magtek readers that are compatible with Authorize.net, listed as follows:

Reader 21040101 (mini USB stripe reader)

Reader 21040102 (mini USB stripe reader)

Reader 21040146 (SureSwipe reader)

Reader 21040104 (Sureswipe reader)

As merchants’ credit card processing needs are diverse, it is always important to get the right Magtek swipe reader.     

If you make your living by selling services and/or merchandise over the Internet, you really need a dependable payment gateway, such as Authorize.net, to help your business complete transactions as smoothly as possible.  Consequently, you may be galvanized to find an Authorize.net reseller – one that can provide the gateway to you in the most cost-effective manner.  The purpose of this article/blog entry is to better acquaint you with one of the most prominent gateways available and its related fees so that you can best decide which Authorize.net reseller to use.

A payment gateway is an e-commerce application or Internet-based mechanism that allows you to conduct business transactions online. The gateway basically gathers all of the information sent to you by the customer and then makes sure their credit card is able to cover the costs. Once this information is confirmed, the payment gateway ensures the authorized funds are deposited into your bank account.

While there are numerous payment gateway companies out there, one of the most popular and largest is Authorize.net. They are one of the most experienced gateway providers in the business as they’ve been around since 1996 and have an exemplary reputation as one of the leaders when it comes to Internet payment services. CyberSource Corporation, another quality Internet business, purchased Authorize.net in 2007 for $565 million.

The gateway system is quite easy to use with ecommerce web sites and it offers several free customer support options, including live chat, just in case you have any trouble using the application. It’s also an ideal tool for call centers, offline retail sites, mobile devices, mail orders and telephone orders. Another bonus of Authorize.net is its scalability, which allows businesses to scale up or down with relative ease.

Authorize.net is generally sold through a wide variety of companies which are known as Authorize.net resellers. This means you can buy their services from any one of the resellers you choose. This will allow you to shop around to find the reseller who can offer the best deal as their prices will vary.

While each Authorize.net reseller is an independent business, there are several fees that all of the companies will charge for the service and some optional ones. As a business person, your job is to compare them and try to find the best fees out there, but to also make sure you buy the service from a reputable seller and not a fly-by-night company that won’t be around to help you when you need it.

Set up fee

On old forums, some merchants have pointed out that that a gateway set up fee reminds them of death and taxes as there’s no real way to avoid it.  This is no longer true as many vendors now waive the start up or set up fee.  However, most Authorize.net resellers charge about $150, but if you look hard enough, you might be able to get it done for as low as $100, and of course if you look in the wrong places, you might be asked to fork out as much as $200 for the set up.

Monthly gateway fee

Just about every reseller will charge you a monthly fee. The cost typically depends on the type of services you include in the package and the reseller. The cost is generally between $10 and $50 each month.

Transaction fee

Again, this will vary from with each Authorize.net reseller, but you can expect to be hit between five and 20 cents for each transaction you complete.  Some companies waive any gateway transaction fee, and others stipulate that it is free up to a certain number of transactions (typically 250 transactions).

Fraud Detection Suite

The Authorize.net payment gateway offers a few fraud prevention tools at no cost, but you have the option of upgrading to the suite for about $5 a month if you choose.

Automated recurring billing

This service is helpful when it comes to collecting regular payments, such as subscriptions for example. It usually costs $10 a month.

Virtual terminal

A virtual terminal will let you accept phone, email, mail, and fax orders and will then use your computer access to manually process the transactions.  Some merchant account providers offer a virtual terminal at no additional expense; others may increase their set up and/or monthly fees by providing a virtual terminal in conjunction with the payment gateway.

eCheck.net

This service will let a customer designate an electronic check from their checking account. It usually costs a merchant between $10 and $30 each month for this service. Be aware that you might be charged a start up fee if you want to accept echecks.  (The processing rate to process an echeck should be less than that to process a credit card.)

Customer Information Manager

This service allows you to securely store important customer information in a database for $20 a month.

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Typically, a vendor who offers Auth.net has liberty to change the set up, monthly, and transaction fees.  (The others rates fall under the domain of Auth.net.)

While there are a myriad of companies that may provide Authoriz.net, by contrasting the aforementioned rates, you’ll be able to locate the best Authorize.net reseller.