Accepting credit and debit card payments is an easy way to increase sales and improve the customer experience for your business. It presents a substantial revenue opportunity, given that the annual transaction amount of credit, debit, and prepaid cards is expected to rise from 776 billion in 2024 to over 1 trillion by 2029. Even businesses that don't sell physical goods can benefit by offering customers an online card payment option, either before or after providing services.

Below, we'll explain how to accept credit and debit card payments online, in person, and by phone.

What's in this article?

• What do you need before accepting credit card payments?
  
• How to accept credit card payments online
  
• How to accept credit card payments in person
  
• How to accept credit card payments over the phone
  
• How to accept recurring credit card payments?
  
• What does it cost to accept credit card payments?
  
• Benefits of accepting credit cards
  
• How Stripe Payments can help
  
• FAQs about accepting credit card payments
  

Quick note: When we mention "credit card payments", we mean both credit card and debit card payments. There isn't much difference in payment processing between the two kinds of cards.

What do you need before accepting credit card payments?

Setting up your payments infrastructure involves several steps from evaluating your needs to activating fraud prevention:

• Define your payment needs: Determine how and where you plan to sell, how many transactions you expect each month, and what card types or digital wallets you want to support. These will shape which processor, pricing model, and hardware make sense for your business.

• Pick a payment structure: Decide between an all-in-one provider that bundles the gateway, processing, and merchant account and a more custom setup with separate pieces from different vendors. All-in-one platforms are usually the simplest for new or smaller businesses, while larger or higher-volume businesses might benefit from a traditional processor and dedicated merchant account.

• Shop and compare providers: Look at pricing models, contract terms, funding speed, and customer support across a few processors. Run your expected sales volume and average transaction size through each provider's fee structure so you can see the real cost differences, not just the advertised rate.

• Apply for and open your account: Submit your application with your business details, tax ID, and banking information. Some providers approve accounts almost instantly, while others require a short underwriting review before you're cleared to start processing.

• Set up your tools and hardware: Configure whatever you need based on how you sell. That might mean a card reader or point-of-sale (POS) terminal for in-person sales, a payment gateway for your website, a mobile app for on-the-go payments, or a virtual terminal for phone orders. Test each channel before you go live to ensure payments flow through correctly.

• Turn on fraud and security protections: Confirm that you meet Payment Card Industry (PCI) compliance requirements, then enable safeguards such as address verification, card verification value (CVV) checks, and any available authentication tools. These measures matter most for online and mobile transactions, which can carry a higher risk of fraud than in-person payments.

How to accept credit card payments online

To start accepting credit card payments, you need to connect your digital storefront and the banking networks. Follow these four steps to set up your payments infrastructure. 

Choose a payment processor and merchant service provider

Payment processors collect payment information from customer transactions and coordinate with the credit card networks, issuing banks (also called issuers), and receiving banks to transfer the funds. If your payment processor doesn't include merchant account capabilities, you'll also need to open a merchant account to accept credit card payments. Stripe offers these capabilities so Stripe customers don't need – and, in fact, cannot have – a separate merchant account.

Set up your digital storefront

Whether it's a custom-built website or a shop on an external marketplace, your storefront is where you present products and where the customer begins the checkout journey.

Integrate a payment gateway and find a payment processor

A payment gateway is an interface for customers to input their payment information. Many top-tier processors provide a gateway that can be embedded directly into your site to ensure a smoother checkout experience. Depending on your business, you might want to support several types of online payments:

• In-app payments for mobile purchases

• Payment links you can send directly without a full checkout flow

• Multicurrency payments for international buyers

• Custom payment methods customised to specific markets or consumer preferences

You'll also need to decide between hosted checkout, in which customers are directed to a page managed by your processor, or on-site checkout, in which the payment form lives directly on your own site.

Connect your accounts and test the flow

Once your storefront and gateway are linked to your processor, the processor will communicate with the credit card networks and banks to transfer funds to you.

Many small business owners use peer-to-peer payments platforms to accept customer payments. Businesses must report any commercial transactions over US$600 received through those apps on their taxes. 

How to accept credit card payments in person

To start accepting credit card payments at a physical location or on the go, follow these steps to set up your infrastructure.

Select hardware based on your business setup

Businesses need a POS system and a card reader to accept credit card payments in person. The exact hardware you'll want to use will depend on the physical setup of your business:

• Countertop card readers: These are best suited to businesses with physical counter space, allowing customers to swipe or tap their credit cards.

• Mobile card readers: These work best for business owners who work outside a fixed location (e.g., plumbers, massage therapists). They connect to phones or tablets via a physical port or Bluetooth.

Connect your hardware with POS software

Card readers typically interface with a POS system. Depending on your provider, this will either be a standardised, ready-to-use product or a highly customisable solution. For example, Stripe Terminal is an all-in-one POS solution that can be set up easily or personalised for specific functionality.

Determine your specific service needs

While online payments are growing, in-person payments remain necessary for several business models:

• Brick-and-mortar retail: Grocery stores, hardware stores and bike shops

• On-site services: Contractors, landscapers and private makeup artists

• Mobile businesses: Food trucks and coffee carts

Enable in-person checkout

It's important to accept payments in person if you're doing business in person. For most mobile businesses, it doesn't make sense to offer online payments only; for instance, few customers buy coffee online only to walk to a corner cart to pick it up.

How to accept credit card payments over the phone

If your business regularly accepts credit card payments over the phone, you probably don't need unique hardware to facilitate these transactions. But you'll need a steady hand. For most businesses, accepting over-the-phone card payments requires manually inputting the card number into a POS terminal or online payment interface. 

Here are some steps to start accepting card transactions over the phone:

• Enable a virtual terminal through your provider: Before you can take a call, you'll want to ensure your payment processor provides a virtual terminal. This is a secure, web-based version of a physical credit card machine that allows you to turn any computer or tablet into a payment station.

• Ensure PCI compliance for manual entry: Because you'll be handling sensitive card data spoken over the phone, it's worth confirming that your process meets the requirements of the Payment Card Industry Data Security Standard (PCI DSS). This typically means never writing down card numbers on paper and using a provider that encrypts the data as you type it.

• Input the card details: To accept a credit card payment by phone, manually input the card number, expiry date, and CVV code into your POS terminal or online payment interface while the customer is on the line

• Consider offering alternatives to manual entry: Alternatively, you can send a secure payment link the customer can complete on their own device. This also lets them pay with a digital wallet like Apple Pay or Google Pay instead of typing in a card number. For businesses that take mobile orders for pickup or delivery, Tap to Pay at the point of handoff – using a phone or tablet as the terminal – can be a faster, lower-risk option than keying in card details during the call.

If you own a business that receives a high volume of phone orders (e.g., a restaurant that handles takeout), manual entry can be tedious and time-consuming. In these cases, it's worth looking into payment processors that can simplify these transactions with solutions such as integrated caller ID and Pay by Link texts.

How to accept recurring credit card payments?

To accept recurring payments, you'll need a processor that supports subscription billing or recurring invoicing. Many providers let you store a customer's card details securely (often called card-on-file or tokenised storage) so you can charge them automatically on a set schedule, without re-entering their information each time.

You can set up a billing plan that defines the amount and frequency (e.g., monthly, annually), then get the customer's authorisation to charge their card on that recurring basis. Your processor should also offer tools such as automatic retries for failed payments and expiry alerts, which help reduce lost revenue when a customer's card expires or a charge doesn't go through.

This approach works well for subscription services, membership businesses, and any company that bills customers on an ongoing basis.

What does it cost to accept credit card payments?

Accepting cards involves several types of credit card processing fees that typically range from 1.5%–3.5% per transaction, depending on the card type and how the payment is processed. To manage your budget effectively, it's helpful to understand the three main components of these costs:

• Interchange fees: This is usually the largest portion of the cost. These fees are set by the card networks like Visa and Mastercard and are paid directly to the bank that issued the customer's card.

• Assessment fees: These are small fees paid directly to the card networks for the use of their infrastructure.

• Processor markup: This is the fee charged by your payment processor for facilitating the transaction, providing hardware, and offering security features.

Costs can also vary based on whether the transaction is card-present (in person) or card-not-present (online or over the phone). Generally, online transactions carry a slightly higher fee to account for the increased risk of fraud.

Benefits of accepting credit cards

Accepting credit cards allows businesses to tap into new markets and improve operations overall. Here are some of the most common benefits:

• Convenience: The convenience of paying with credit cards can increase sales

• Impulse purchases: Credit cards can encourage impulse purchases since customers aren't limited to the cash they have on hand.

• Payment flexibility: Offering multiple payment options allows customers to use their preferred payment methods, which can improve customer satisfaction

• Online and mobile payments: Accepting credit cards is important for e-commerce and mobile transactions as it caters to those who prefer to shop online

• Professionalism: Accepting credit cards can add to a business's credibility and image of professionalism.

• Customer trust: It instils trust in customers as businesses that accept credit cards are often perceived as more reliable and established

• Less cash handling: Credit cards minimize the risks of theft and human error associated with handling cash.

• Fraud prevention: Credit card companies often provide fraud detection and protection services

• International sales: Accepting credit cards enables businesses to sell to international customers, expanding their market reach.

• Currency conversion: Credit card processors and payment processors that facilitate card payments often handle currency conversion, making it easier to conduct international transactions

How Stripe Payments can help

Stripe Payments provides a unified, global payments solution that helps any business – from scaling startups to global enterprises – accept payments online, in person and around the world.

Stripe Payments can help you:

• Optimise your checkout experience: Create a frictionless customer experience and save thousands of engineering hours with prebuilt payment UIs, access to 125+ payment methods, and Link, a digital wallet built by Stripe.

• Expand to new markets faster: Reach customers worldwide and reduce the complexity and cost of multicurrency management with cross-border payment options, available in 195 countries across 135+ currencies.

• Unify payments in person and online: Build a unified commerce experience across online and in-person channels to personalise interactions, reward loyalty and grow revenue.

• Improve payment performance: Increase revenue with a range of customisable, easy-to-configure payment tools, including no-code fraud protection and advanced capabilities to improve authorisation rates.

• Move faster with a flexible, reliable platform for growth: Build on a platform designed to scale with you, with 99.999% historical uptime and industry-leading reliability.

Learn more about how Stripe Payments can power your online and in-person payments or get started today.

FAQs about accepting credit card payments