Hi Chandie:
With the elevated world of computer fraud and identity theft a business owner needs to use caution and gut instincts when accepting different methods of payment.
The following are some concerns addressed in the past in dealing both brick and mortar and on-line. As in all things testing the waters is important to getting the right mix.
At one time basic cash was the god of commerce. While remaining the preferred safety choice, cash has become impractical with the increased use of debit and credit cards, electronic checks and the desire to purchase on the world-wide-web.
As in anything due diligence and common sense can pay off. Knowing what your bank’s business account policies are will help to determine what payment methods would be a good fix in connection with a business checking account or a business Visa or Mastercard.
Accepting checks, electronic or hard copy, debit cards or money orders are usually Bank backed by a $100,000 protection against fraud. A credit card account direct from a credit card company are handled differently.
When a stolen card is used and clears a business account with deposited funds, the legal owner has 120 days to refute the purchase asking for a refund, meaning you the business owner must payback the credit card company. Far too often the thief has acquired the merchandise long before the credit card company notifies the shop owner there is a problem. Worse is the unexpected automatic reversal of the fraudulent amount from a business checking account.
This same problem can occur with no protections with Currency Exchange money orders, and direct deposits from out-of-state or out-of-country origins. Accepting direct deposits on-line is a major risk because of the exchange of deposit information and the potential of unauthorized withdrawals.
It has been my experience and understanding: majority of purchases are made through Mastercard, and Visa, personal and business-wise, and should be all that is needed for a brick and mortar or on-line business.
Though a banker will assist in dealing with the credit card companies associated with the Bank . .one’s subjective consideration on what payment options to offer should include what credit cards are used extensively - how easy a credit card company will be to deal with – what are the wide variance in rates, fees and charges. This also applies to the mad-mad world of Internet purchases where some card companies are less efficient than others with the lack of protections banks offer.
Billions of purchasing options are used daily successfully, personally and commercially without incident. One has more control over cash or check purchases at the local level one doesn’t have on the Internet.
Banks generally offer protections credit card companies don’t. Knowing what protections a bank offers is pivotal for business checking account control.
Dealing with the right credit card companies can save money. They are highly competitive especially if you have a store-front and choose to sell on-line. The longer the company has been in business; the larger the volume of business - the better rates the business will command.
Be cautious in dealing with a card company on-line not a prominent or well known business. Ask your banker to recommend a reputable company if you do not qualify through your Bank's Credit Card Banking Department like National Bankcard Corp 1-800-928-2583.
Jane Doe Chronicles
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