Taking payment through your mobile phone

August 8, 2012

It should come as no surprise that we are using our smart phones more for everyday tasks such as online browsing, shopping and banking. As a customer it is becoming increasingly easy to undertake transactions, especially when they are greeted with a mobile optimised shopping experience. But what about business owners, how can they use their mobile devices and mobile services to their advantage.

Up until recently business owners have been forced to use fixed till points or at best limited range credit card readers. If your business is mobile, lets say you're a mobile dog groomer, card payments on the go have been virtually impossible, forcing your clients to pay you cash, write a cheque or transfer money online. Each has its own set of problems, clients paying cash may not have the money with them to pay you, or maybe worse not enough this forces you into an awkward position, do you accept less money for your services or do you refuse the service altogether? Cheques are practically defunct and are unlikely to exist for much longer (despite complaints), not to mention the delay in receiving payment, once you've actually deposited it. Transferring money of course means trusting an individual to send you the money and chasing them up if they don't.

So what's new, a few things actually...

Several companies have launched in the last few years to solve the problem of mobile credit card payments including Square (launched in 2010 by Twitter co-founder Jack Dorsey), iZettle and PayPal Here. To accept credit cards as payment all you have to do is attach a card reader to your phone and use their software, you can potentially be up and running in minutes in most instances, especially as some services don't require the reader, just the card numbers punched into the app on your phone or tablet.

Let's use a small jewellery business as another example of how they can benefit from mobile payments. Businesses such as these often sell their work in craft fairs in a number of locations, potential customers looking at your goods are more likely to buy from you if you are providing them with a convenient method of payment (how often have you have heard "I'll be back in a bit, just got to pop to the cash point" only for them not to come back). Taking excuses out of the decision making process should make sales easier to complete and give you an extra air of professionalism. However, with any new service, especially one that is technologically based and involving money it may take a little time to get people to trust a system new to them.

Apart from the convenience for customers there are other benefits, the transaction rates often mean that business owners can save money when compared to traditional credit card payment systems and money is deposited much quicker (although not immediately). From what I can see, the pluses far outway the negatives although for those of us based in the UK, some of these services are not yet available. Square hasn't yet announced a UK launch date, iZettle is currently accepting applicants to its beta program and PayPal Here is US only at the moment. That said I think all small business owners who move around a lot and would benefit from being able to accept credit card payments should keep an eye on the three companies listed here as I am sure it won't be long before they launch fully in the UK.

Richard Wendon

Written by Richard Wendon for Yoyo Design

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