5 Ways to Pick the Right Mobile Payment Plan

Angie Mansfield

April 24, 2013


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According to digital media research and consulting firm Generator Research, the mobile payment market is set to grow to more than $633 billion, with more than 490 million users, by 2014.

And a recent study by the Pew Research Center found that 65% of the experts polled believed that mobile phones will replace wallets by 2020.

It's clear that accepting mobile payments is becoming increasingly important in today's business world.

But how can you choose the right plan for your small business?

1. Think security -

The first item on the list for a reason, security is a major concern when choosing a mobile payment provider.

As smartphones and tablets become more and more popular, mobile viruses are starting to rear their ugly heads. Your first priority when choosing which mobile payment plan to go with is the provider's focus on security. Do they provide encryption on both the hardware (card swipe device) and software (mobile app)?

2. Make a plan

Outline your goals for adding mobile payments to your business plan. Do you have a lot of younger, tech-savvy customers who are looking to pay with an app instead of carrying cards?

Are you trying to attract or retain customers by providing extra convenience in the checkout process? Which customers, exactly, are you targeting with this technology? Defining your goals will help you weed out mobile payment providers whose services don't meet those needs.

3. Learn about your options

There are several different types of mobile payment technology, each of which may or may not fit with your current operations:

NFC (Near Field Communication): This technology consists of a POS terminal in your place of business, and an app on the customer's smartphone. Your customer can wave the phone near the terminal to make a payment.
QR codes: In this model, your business gets its own personal QR code, which customers can use to pay you via a free app.
Mobile credit card processing: This option uses a device, which generally consists of a dongle attached to your smartphone or tablet, to allow you to swipe your customer's credit card from anywhere. This option is perfect for service-based businesses, or those that sell products at trade fairs and other locations besides a brick-and-mortar store.

4. Research

Once you've narrowed down the type of mobile payment you'd like to offer, it's time to do a little research on the companies offering that technology.

Some important questions to ask include:

How much will it cost? Is there a monthly/yearly subscription?
How much is the fee per transaction?
Are there any "hidden" fees?

5. Check their references

Just as with any other service you hire for your small business, you should check up on your mobile payment provider's reputation. Ask on social media, check with local businesses similar to yours, and search for reviews online.

Choosing the right mobile payment plan is an important consideration for your company.

By doing a little homework, you can make sure you -- and your customers -- don't get burned.