Looking for cheap credit card payment processing; using Square, looking at Dwolla
Here's my situation:
- I accept credit cards (Amex) over my Android phone
- About 1 or 2 transactions per month
- Each transaction is generally between $1,000 - $7,000
Square is nice & easy--virtually no setup--but the fees are a bit high, 3.5% per phone transaction.
I recently found Dwolla.com, who offers a transaction cost of 25 cents (!) per transaction--which would save me a bunch of money. However, I've seen mixed reviews of Dwolla online, and wanted to know if anyone else has used it and what their experience has been.
Hey Greg, This is a GREAT QUESTION. One that applies to so many entrepreneurs, since credit card processing is the foundation to building an automated business (typically online). <hl> I have spent countless hours dealing with credit card processing gateways, processors, terminals, reps, etc. I feel very qualified to answer this. <hl> There is so many ways to "skin this cat", but after reading the following, the is <hl> 1. You want to have Authorize.net as part of your plan. It is not necessary, but Authorize.net integrates with more online apps and shopping carts than any other gateway. If you use Freshbooks, it integrates. If you use Volusion shopping cart, it integrates. If you decide to use another gateway, you might learn down the road that you need to open another gateway to make it work. BUT DON'T OPEN A AUTHORIZE.NET ACCOUNT JUST YET. Keep reading to learn why. (hint: you get one almost free when you sign up with a processor) <hl> 2. Find a Processor (merchant services account) that charges you based on the "interchange plus" method. There are SO MANY slick sales people out there that want to sell you credit card processing based on a confusing "tiered" fee method. DON'T DO IT. The pricing model may seem simple, but they trap you into paying fees you aren't aware of, and you don't really know which cards you pay higher rates for and which ones you get lower rates on. All the big guys are on "interchange plus" method because you can compare rates from different processors - apples to apples. This levels the playing field, and you can shop around for the lowest rates. <hl> 3. Paypal, Square and Dwolla are their own processors, so you will pay their rates no matter what. They are not cheap. So if you want to save money, you should get your own independent merchant account. One that works with Authorize.net preferably. If only do a few transactions, then maybe the simplicity of Paypal, Square are worth looking at. <hl> 4. The Processor I found that meets all of these requirements is iPayment. I got an insider with iPayment that gives me a really good rate. Each rep is different, so negotiate hard. My rates are "interchange + 0.01 and 10 cents". That means I am charged interchange rate (the rates the credit card companies charge the processor) PLUS .01 percent PLUS 10 cents per transaction. There is no minimums or contract terms. A $5 monthly statement fee, and an almost free Authorize.net account comes with it. THIS IS A REALLY GOOD RATE. So try to match it with your rep. <hl> 5. OK, I just called my rep as I wrote this. He said he would give our listeners the same rates if they identified themselves as an ASMB listener. His email address is firstname.lastname@example.org. His name is Robert Renfro. Email him, you can get the same rates I do. <hl> 6. iPhone/Android integration: This is important to you, so let's touch on this. There are third party solutions you could use to get your smartphone to become a card reader (terminal). Both "card present" and "card not present" will work. If you have an Authorize.net account, you will need to use one that works with Authorize.net. That is where they shine. Just search for authorize.net in your itunes app store or android marketplace. Inner Fence is the most popular, but I haven't tried any of them, so I can't give an honest review. You will also need the card reader. There are generic versions of iPhone card readers. This youtube clip is cheesy, but shows an example: InnerFence YouTube video
I think you meant an AMSB listener instead of an ASMB listener. :)