Before you Process Transactions Wireless, know this!
by Jamie Estep
Published on this site: April 25th, 2005 - See
more articles from this month...
Wireless Credit Card Processing is a relatively new service that
will allow a person to process credit cards electronically virtually
anywhere. Wireless credit card processing is a very desirable system,
because it allows businesses to process transactions from mobile
locations quickly, efficiently and professionally.
Wireless credit card processing is most often used by businesses
that operate mainly in a mobile environment. These businesses include
mobile utility repair service businesses, locksmiths, mobile windshield
repair and others. There are even some upscale restaurants that
are using wireless processing equipment for the security of their
credit card paying customers.
While wireless processing is a very good system for many companies,
it is not for all mobile businesses. There are some drawbacks to
wireless processing that many potential wireless users should be
aware of before they venture into wireless processing.
- First: Wireless processing equipment is expensive.
There's no way to get around this. Wireless credit card
machines are the most advanced processing terminals available.
You get what you pay for! You may be able to get a lease
on a wireless terminal, but in the end you will pay significantly
more than purchasing the terminal outright. For a wireless
terminal with a printer, expect to pay at least $800 for
a new terminal, and $700 for a refurbished terminal. If
you find yourself about to purchase a terminal that is much
cheaper than any others you find, it is most likely outdated
equipment that uses outdated cellular networks. In other
words, IT'S A SCAM, and you are about to buy a really expensive
paperweight.
- Second: Wireless processing comes with extra fees.
Just like a cell phone, wireless credit card machines operate
on cellular networks. You have to pay for this cellular
service in addition to the high cost of equipment. Luckily
wireless fees for processing are nowhere near what they
are for cell phones. Expect to pay $20 - $25 / month for
a wireless service fee.
- Third: Wireless Credit Card Machines are subject
to cellular coverage blackouts. I know what you're thinking.
My cell phone works almost everywhere, so my wireless credit
card machine will too. Sadly this is nowhere near the case.
Wireless credit card processing uses a business cellular
network called the Motient or Mobitex networks. Your cell
phone uses a networks called CDMA or TDMA(GSM)networks.
The coverage that your cell phone gets is much greater than
the wireless processing network. There are at least five
states with no coverage for wireless processing at all!
- Fourth: You cannot process checks or debit transactions
over a wireless network. Currently due to federal regulations,
it is impossible to process debit transactions, or electronic
checks over a wireless network. This is something that will
probably end up being allowed in the future, but as of now
there's isn't sufficient security or encryption to process
these transactions wireless.
What it comes down to, is whether your business does a sufficient
volume of 'credit card' transactions and your area is within the
Mobitex or Motient coverage area, to warrant the extra costs of
a wireless processing solution. There are other solutions available
for mobile businesses with lower volume or in no coverage areas
that are better suited for these businesses.
Many companies offer outdated wireless terminals for sale
on ebay or through special offers. They are selling these
terminals to rip off the unknowing customer. These discount
terminals use a wireless network called the CDPD network.
This network is being abandoned as a processing network rendering
these machines useless for wireless processing. Make sure
the terminal you are buying is not a CDPD terminal. If the
seller wont disclose, doesn't know which network the machine
operated on, or tells you that the terminal will still work,
walk away. Its not worth loosing the money over.
Also in the next year, the TDMA and CDMA networks are scheduled
to be opening up to wireless credit card processing. There
are already several terminals designed to operate on these
networks that are undergoing their final certification. These
networks will open up most of the US to wireless processing
even in areas that were restricted in cellular coverage before.
Jamie Estep, director of the Merchant Equipment Store.
The Merchant Equipment Store helps all types of business to accept
credit cards. Visit them at http://www.merchantequip.com
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