In an effort to replicate the success that several startups and other companies had in releasing their own mobile credit and debit card payments, one of the nation's largest and best-known banks recently launched its own version of such a platform.
Many companies, especially those such as Square and Intuit GoPayment, found massive success in recent years by giving small business owners the ability to circumvent the often-expensive traditional payment processing industry, and now more, and bigger, businesses are flooding into the market. The latest to do so is Bank of America, which recently launched a service called Mobile Pay on Demand [and] gives small companies added flexibility in accepting credit and debit card payments from anywhere.
How this program works
The Mobile Pay on Demand platform operates just as any other competitor in its field does: The company provides a mobile card reader that plugs into a smart phone or tablet device (currently the program only works with Android and iOS devices), and has an application associated with it, Bank of America said. When used in concert, they can process a payment from a customer with relative ease. The system also works through a web-based system that can be used to send cardholder information. It works with all cards issued by Visa, MasterCard, Discover, and American Express.
When a transaction is processed, the program generates an electronic receipt that the businesses can email to a customer, the report said. Further, the company itself gets instant authorization on the transaction, meaning that business owners won't have to wait very long(usually the next business day) to actually receive payment on the purchase they just processed.
Different levels of service
There are also three tiers of service available to small business owners, each with their own features, the report said. For instance, the baseline program is designed for companies that handle relatively few transactions every day. These must be completed in person, with an average sale total of less than $2,000. Further, Bank of America will only allow these users to operate one device per account. However, those companies will also avoid any monthly fees for using the platform.
Mobile Pay Business, on the other hand, is specifically for companies that process a large number of transactions per day, and can be used not only for in-person purchases, but also those by mail and by phone, the report said. There is no set average sales amount, and it supports more than one device on a single account. However, it also comes with monthly fees.
Finally, the company also offers the FD400 Series Wireless Terminal, which uses its own dedicated point of sale device, and comes with most of the same features as Mobile Pay Business, the report said. Where it differs, however, is that it processes payments far more quickly.
The platform also comes with a number of security features designed to make transactions much safer, the report said. There are a number of fraud protection tools built into the app, and SSL encryption technology which makes it far more difficult for any hacker trying to gain access to transaction data.
How competitive is it?
Bank of America is so sure that its mobile payment processing fees are the best in the industry that it will give a potential client $500 if they can find evidence of lower ones, the report said. Its current swipe fee is 2.7 percent of the total transaction's value for all payments processed directly through its card reader, for all Visa, MasterCard and Discover accounts. For those where the credit or debit card account number has to be manually entered into the app, the rate is 3.5 percent plus 15 cents.
For American Express cards, however, the rates are different, the report said. Those swipe fees can vary from 2.3 to 3.5 percent, and come with an added charge of between zero and 15 cents per purchase, though each transaction cost will be based on several factors.
More secure payment processing services can be extremely helpful for both consumers and businesses alike, but people who want to protect their finances in earnest will have to do more than that to ensure their safety. Borrowers should also take the time to order a copy of their credit report a few times a year and check it over closely for any unfair markings that may appear on it. If any of these entries are discovered, it might be a good idea to work with a credit repair law firm, which may allow them to correct the issue as quickly as possible, and potentially bring their standing back to where it deserves to be.