How to choose the best platform to accept credit card payments

Payments
Payments

Accept payments online, in person, and around the world with a payments solution built for any business – from scaling startups to global enterprises.

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  1. Introduction
  2. Why is accepting credit card payments important for businesses?
  3. How do payments platforms enable credit card payments?
  4. What should businesses look for in a credit card payments platform?
    1. Easy onboarding and integration
    2. Strong security measures
    3. Multiple card networks and payment methods
    4. Transparent pricing
    5. Scalability
    6. Recurring payments and subscription tools
    7. Real-time analytics
    8. Customer support
  5. How does Stripe make credit card processing easier for businesses?
    1. Developer-friendly application programming interface (API)
    2. Global accessibility
    3. Simple compliance and powerful security
    4. Subscription and billing management
    5. Customization
    6. Detailed analytics and reporting
  6. What are the challenges of accepting credit cards?
    1. Transaction fees
    2. Chargebacks and fraud
    3. PCI compliance
    4. Cash flow timing
    5. Technical issues
  7. How do credit card platforms integrate with accounting software?
    1. Reconciliation
    2. Calculating taxes
    3. Multicurrency support

Credit cards have become an everyday fixture in our buying habits. Credit card payments are fast, widely used, and eliminate the need to carry cash or checks. The global credit card payment market was valued at $498.3 billion in 2023 and shows no signs of slowing down.

Companies of all sizes rely on credit card payments, but setting up your business to accept credit cards can seem daunting. Handling the necessary hardware, fees, and security checks—in addition to figuring out which provider to use—can be overwhelming if you don’t know where to start. Below, we’ll explain how platforms handle card transactions, the features that separate average providers from best-in-class providers, and how Stripe can help you manage credit card payments.

What’s in this article?

  • Why is accepting credit card payments important for businesses?
  • How do payments platforms enable credit card payments?
  • What should businesses look for in a credit card payments platform?
  • How does Stripe make credit card processing easier for businesses?
  • What are the challenges of accepting credit cards?
  • How do credit card platforms integrate with accounting software?

Why is accepting credit card payments important for businesses?

Credit cards were the second most popular payment method for online shopping in the United States, as of 2023. The immense popularity of this payment method shows why credit card acceptance is so important. Here are a few more reasons why it matters for businesses:

  • Wider customer reach: Credit cards are convenient. Refusing to accept them can turn away potential customers.

  • Faster authorization: Credit card payments are typically authorized faster than other payment forms, such as checks. You’ll see whether the payment is approved or declined immediately, which can help with cash flow.

  • More credibility: Accepting cards can make a small business seem more established, because this is a common trait among large retailers and well-known brands. Accepting credit cards can signal legitimacy to customers.

  • Potential for higher-value orders: Studies have shown that people tend to spend more when they pay with credit cards. They’re less restricted by the immediate balance in their checking accounts, which can increase the average order value.

  • Ease of recurring billing: If your business uses memberships, ongoing services, or recurring billing, securely storing a customer’s credit card details is much easier than chasing down cash or checks each billing cycle.

How do payments platforms enable credit card payments?

A credit card transaction starts with a customer entering their payment details or manually swiping or tapping their card. Here’s what happens next to process that payment:

  • The payment processor sends an authorization request to the card network.

  • The card network sends the request to the issuing bank to check whether the card is valid and has enough credit available to cover the transaction.

  • The issuing bank either approves or declines the charge. If approved, the purchase is completed, and the business provides the goods or services to the customer.

  • Businesses submit the day’s approved credit card transactions to the processor in one batch for settlement. The processor forwards details of the transactions to the proper card networks.

  • Within a few days, the funds are transferred to the acquiring bank and then to the business’s bank account. The payments platform notes the transaction details, fees, and status for recordkeeping purposes.

During this process, additional checks such as 3D Secure might also be used to confirm the cardholder’s identity and prevent fraud.

What should businesses look for in a credit card payments platform?

Although many platforms allow businesses to accept card payments, the best share a few important traits. Here’s what to look for when you choose the right platform for your business.

Easy onboarding and integration

A good platform provides easy-to-use setup tools, clear documentation, and user-friendly dashboards that don’t exceed your technical skills. If you choose a more customized setup, ensure the provider has tools to help you get started.

Strong security measures

Credit card data is sensitive information, and any breach can erode trust in your business and leave your customers vulnerable. Look for providers that adhere to the Payment Card Industry Data Security Standard (PCI DSS) and offer features such as tokenization to protect personal information. Two-factor authentication (2FA) is another benefit to look for to stop unauthorized logins.

Multiple card networks and payment methods

The ideal platform should support a broad range of cards so you’re not turning customers away. While Visa and Mastercard are the most popular cards, consider whether your customers also use American Express, Discover, or regional credit cards.

Transparent pricing

Transaction fees add up, especially if you’re running a high-volume operation. Some providers charge a per-transaction rate with no monthly cost, while others also have flat fees or tiered monthly pricing. It’s important to figure out exactly how these fees will affect you.

Scalability

If you plan to scale your operations in the future, you’ll want a platform that can grow with you. Your platform should be able to handle higher transaction volumes and allow you to add new features as your needs change.

Recurring payments and subscription tools

Even if you’re not using subscription billing now, it might be a good idea to pick a provider that can support recurring payments. If you decide to sell subscriptions or memberships in the future, you won’t have to switch platforms.

Real-time analytics

Having a live view of your daily sales, average order values, and busiest times can help you make more informed decisions about your business. Detailed reporting can shape your marketing tactics, inventory planning, and more.

Customer support

If something goes wrong, such as a sudden rise in declined transactions, you’ll need to troubleshoot. Reliable support can make the difference between a small issue and a cascading problem.

How does Stripe make credit card processing easier for businesses?

Stripe simplifies online payments for businesses and accepting credit cards is a major part of that mission. Here’s how Stripe stands out.

Developer-friendly application programming interface (API)

Stripe’s API is designed so businesses can quickly integrate card payments into their websites and apps—even businesses with smaller development teams. If you want a more straightforward solution, Stripe offers prebuilt components such as Stripe Checkout.

Global accessibility

Stripe supports many card networks and payment methods across dozens of countries. This is a major benefit for businesses with international customer bases.

Simple compliance and powerful security

Stripe handles the burden of PCI DSS compliance to meet security standards. It tokenizes card data so sensitive details don’t stay in your servers and offers built-in tools such as Stripe Radar, which analyzes each transaction’s threat level in real time for fraud prevention.

Subscription and billing management

If you run a membership-based business, offer a subscription-based software-as-a-service (SaaS) product, or rely on a recurring billing model, Stripe Billing helps you automate free trials and prorated charges and send reminders. It’s designed for businesses that want flexible subscription logic without starting from scratch.

Customization

Stripe Elements lets you personalize the checkout experience to match your visual branding. You can match fonts and colors to your brand rather than use a generic payment form.

Detailed analytics and reporting

The Stripe Dashboard offers real-time insight on your transaction volume, chargebacks, revenue, and more. This data syncs easily with other systems, which makes monthly reconciliation much simpler.

What are the challenges of accepting credit cards?

While credit card payments allow you to serve new customers, they also come with potential hurdles. Below are some of the challenges to remember.

Transaction fees

Every card purchase affects your total revenue. If your margins are tight, transaction fees can be tough to absorb. Some businesses build the expense of fees into their pricing, while others seek out volume-based discounts.

Chargebacks and fraud

Fraudulent transactions and chargebacks take time and resources to resolve. Platforms often help you fight chargebacks by storing shipping confirmations or digital receipts, but handling these issues can still be time-consuming.

PCI compliance

If you store card details yourself (which is generally not recommended), you are responsible for meeting strict security standards. Payments platforms relieve much of that burden, but you still need to follow best practices for handling payment data.

Cash flow timing

Credit card payments aren’t instantly deposited into your account. You’ll probably see the funds a few days later; sometimes it takes longer with weekends or holidays. Plan your finances accordingly so you’re not caught short when bills come due.

Technical issues

A well-coded integration usually runs without a hitch. Even so, server downtime or connection problems between your site and the payment gateway can cause transactions to fail. Having a backup plan—such as an alternate payment method or an offline solution—can help you avoid losing sales.

How do credit card platforms integrate with accounting software?

Once you begin processing credit card payments, you’ll need a reliable way to record them. Manual data entry is tedious, prone to mistakes, and can lead to reconciliation issues. Many credit card platforms solve this problem by integrating with popular accounting tools such as QuickBooks, Xero, and FreshBooks. That means every sale, refund, or fee automatically appears in your accounting dashboard.

The platform might integrate directly or use a third-party connector service such as Zapier or Make (formerly Integromat) to link your systems and update your books as new transactions come in. For customized accounting systems where direct data transfer doesn’t make sense, you can typically export your transaction data from the payments platform as CSV or Excel files and then upload or import the files into your accounting records.

Here’s how integrating your payments platform with your accounting software can benefit your business.

Reconciliation

Integrating your payments platform with accounting software makes closings at the end of the month or quarter cleaner. You can see which transactions cleared, which might be pending, and which were disputed. From there, you can match them with your bank deposits without wasting time scrolling through spreadsheets.

Calculating taxes

Some setups allow you to sync tax information for each transaction. This is helpful if you charge different rates by region or if you need to separate sales tax from product revenue. Your accounting program will keep a running total of the collected taxes that you can reference when filing.

Multicurrency support

Certain payments platforms and accounting programs handle currency conversion automatically. They log the exchange rate for transactions that require currency conversion and convert amounts for your books as needed.

The content in this article is for general information and education purposes only and should not be construed as legal or tax advice. Stripe does not warrant or guarantee the accuracy, completeness, adequacy, or currency of the information in the article. You should seek the advice of a competent lawyer or accountant licensed to practise in your jurisdiction for advice on your particular situation.

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Payments

Payments

Accept payments online, in person, and around the world with a payments solution built for any business.

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