Wireless Credit Card Processing Risk Classification

Merchant Warehouse |

December 7, 2010

Today, credit card processing solutions have quickly proliferated in great variety due to the emergence of modern cutting-edge cellular telephone technology. Merchants have available to them two different kinds of wireless services, which are long-range and short-range. The short-range variety of service is for those merchants who need to accept credit card payments at their own home base location but do not want to be limited to a specific spot from which to checkout customers and close sales transactions. These shot-range services have a range of several hundred feet around a base or originating terminal. The long-range solution, on the other hand, requires network capability and merchants can easily move the technology with them in order to utilize it anywhere, as long as there is, of course, a wireless connection available.

Merchants who use wireless credit card processing solutions fall under a few risk classifications, which are based on a handful of factors. In the course of a credit card sales transaction, the presence of the actual credit card at the time that the payment is made is where a wireless solution plays a role and helps reduce risk. If a business accepts credit card payments away from their home base by gathering customer payment information on a written form or as a computer document, and later enters this information into a payment processing terminal or keys it into a telephone, this payment mode will be immediately qualified as high risk without even considering the other factors. In the case of a wireless processing solution in which the customer would swipe their credit card through a credit card reader, the transaction will fall into the “credit card present” category that is the first factor considered when determining risk level. “Card present” scenarios are generally considered low-risk scenarios. As an added benefit, the merchant saves a great deal of time as there is no need to enter data manually into the credit card processing terminal.

Every major credit card processing provider offers a wireless processing service. In terms of hardware for retail use, merchants have a great number of terminals to choose from. Although their price tags are still pretty high, ranging from a few hundred dollars to a thousand dollars in the United States, they have been falling steadily as technology becomes cheaper to producer over time. There are additional credit card processing fees that are applied to wireless solutions as well. As a merchant, you will also pay an additional monthly fee for every credit card processing terminal that your business has and an additional per transaction fee. There will very likely be an activation fee to pay monthly, as well.

The most significant issue, when it comes to wireless credit card processing, is the availability of the wireless signal that enable the process to happen. It is imperative to make absolutely certain that your merchant service provider’s wireless network coverage is robust and broadly accessible in your service area, in order to avoid maintain clear connections and process payments perfectly.