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How to accept credit card payments

Find out how to accept credit card payments for your business, why it's important to do so, and what you need to consider.

Why should a small business accept credit cards?

All companies should accept credit card payments. The majority of consumers expect businesses to take their preferred payment method, with almost half of all online purchases (48%) paid for by card in Australia in 2022.

In most cases, credit card companies will deposit your funds within a few days, which helps you maintain your cash flow reserves and plan for future spending. 

Accepting credit card payments also protects your business against potential disputes, since you and your customers have a digital record of transactions that can help resolve issues more quickly. 

What types of businesses can accept credit card payments?

Any business can accept credit cards, including those that: 

  • run a brick-and-mortar business

  • operate a business entirely online

  • have a traditional small business with employees

  • are freelancers or independent contractors

  • run a mobile business like a food truck

  • are sole proprietors without employees.

Methods of accepting credit cards

Accepting cards in-store

Accepting credit cards in your brick-and-mortar store, like in a shop or restaurant, requires a point-of-sale (POS) system where customers can tap or insert their credit cards. The terminal then processes the payment, which will land in your account in a day or two. 

Accepting credit cards online

To accept credit cards online via an online store or an ecommerce marketplace, you need a payment gateway and either a Payment Service Provider (PSP) or a merchant account. The payment gateway is responsible for encryption and secure communication, while the PSP manages the end-to-end transaction process and the final transfer of funds.

Mobile credit card processing

You can use a payment processing app on your phone to accept credit cards at your mobile business or on the go without your POS. This option is great for farmers’ markets, fairs or trade shows. 

How does credit card processing work?

You process credit card payments the same regardless of what type of store you run. The only difference is how customers submit their card information, either by swiping, inserting or tapping their credit card on your POS, or by entering their card details online. 

After receiving a customer’s credit card details, the payment gateway securely encrypts the information. Then, it communicates with the relevant credit card networks for transaction authorisation. After approval, it communicates with the PSP, which transfers the funds from the customer’s account to your merchant account. 

Debit cards vs credit card transactions

At a surface level, debit and credit card processes seem the same‌ — ‌a customer enters their information, and the bank processes it. However, the back end of the processes differs considerably.

The most significant difference is that a debit card transaction pulls the money from a customer’s account immediately, while a credit transaction takes longer. In addition, a credit card transaction requires the payment processor to approve the payment and then put the money into your account before they settle with the customer. The process can take a few days in total. 

Understanding credit card fees

When you accept a credit card payment, PSPs charge you a merchant credit card fee. Card networks, card types and in-store versus online transactions influence the fee amount. 

You can offset these fees by surcharging your customers. In Australia, however, surcharges are highly regulated. You can find more information about card surcharge regulations on the government website, but generally:

  • Fees must not exceed the costs incurred.

  • You must be able to prove the fees.

  • Display prices must include the surcharge if there’s no other payment option 

How to accept credit card payments

1. Make sure you have the right technology

You need the right tech to accept credit card payments. Depending on where you operate, this technology might include a card reader, a POS system or a PSP with a payment gateway. Each of these comes with its own rules. 

Card reader requirements

If you plan on accepting credit card payments in-store, you’ll need a card reader and a POS. In Australia, you’ll need an EFTPOS chip card-enabled reader to comply with changing regulations. Chip credit cards are more secure than swipe-only ones, leading to the elimination of chipless cards.  

Storefronts, payment processors and payment gateways

To accept credit card payments online, you'll need a digital storefront with a shopping cart. An ecommerce platform provider can help you set this up. Also, you’ll need to connect your storefront to a payment gateway and a PSP. 

Your PSP likely provides its own payment gateway, but you can always choose a third-party provider. It's essential to compare the features and costs of different payment gateways to ensure you're getting the best deal. 

2. Decide on a payment processing method

There are two types of payment processing methods to consider:

  • Merchant account and payment gateway combo: A merchant account is an account opened directly with a bank so that you can accept credit card payments. 

  • All-in-one solutions: Payment service providers combine an account and gateway into one solution, which can make setup quicker and easier. 

Choose the option that best fits your business needs. Aside from being easier to manage, PSPs usually have lower fees, which can benefit new businesses or those with few credit card payments. In cases where you process a lot of credit card payments, it may be easier to manage your transactions with a dedicated merchant account. 

3. Compare service providers

Once you decide what service you’ll use, compare providers to make sure you choose the right one for your business. Here are some things to consider:

  • Fees: Ask about setup, payment and transaction costs. 

  • Length of setup: Check how long it takes to set up‌ — ‌a complete package can make this easier. 

  • Customer support: Know what support options are available through each provider. 

  • Payment reports: Your accountant needs a record of credit card payments. 

  • Website compatibility: Most payment providers integrate seamlessly with website services, but double-check.

4. Set up your account

After selecting your providers, set up your accounts. The process may be simple if you've chosen a PSP that offers all-in-one solutions, but it may require multiple steps if you need to set up a merchant account and payment gateway.

5. Incorporate your accounting software

Get a top-level view of credit card payments and their accompanying fees by incorporating them into your accounting software. This integration will automatically update your accounts and simplify managing varying fees across online payments, in-store and different gateways. MYOB’s invoicing software helps you track payments from various sources. 

Collect credit card payments with MYOB

Whether you’re collecting payment at point of sale or sending invoices to your customers, MYOB has you covered.

MYOB is a business management platform that accepts all major credit cards (in addition to BPAY, Apple Pay and Google Pay). With MYOB you can invoice customers, track the status of outstanding invoices, accept payments and account for income, expenses and GST to make tax time easy.

Further, you can integrate your Shopify commerce platform with MYOB Acumatica, supporting you in managing your business whether you sell online, in retail stores or on the go. Contact an enterprise solution specialist to find out more and get started.


Disclaimer: Information provided in this article is of a general nature and does not consider your personal situation. It does not constitute legal, financial, or other professional advice and should not be relied upon as a statement of law, policy or advice. You should consider whether this information is appropriate to your needs and, if necessary, seek independent advice. This information is only accurate at the time of publication. Although every effort has been made to verify the accuracy of the information contained on this webpage, MYOB disclaims, to the extent permitted by law, all liability for the information contained on this webpage or any loss or damage suffered by any person directly or indirectly through relying on this information.

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