Coronavirus Payments Guide: Everything You Need To Know About Switching To Online & Phone Payments

As we all gear up to face the grim reality of the global coronavirus pandemic, businesses around the world are confronting the enormity of the challenges ahead of them. The need to minimize the risk faced by vulnerable public-facing employees is particularly important, as the fiscal health of your business is dependent on your ability to keep your essential employees safe.

Thankfully, there are steps many businesses can take to reduce in-person contact. One such step is to reconfigure the way your business accepts payments. In this article, we’ll discuss ways your business can minimize personal exposure by accepting remote payments — both online and over the phone.

Is Cash Still Safe To Handle?

Cash is an efficient means of germ transmission even in the best of times. A Swiss study from 2008 found that, in some circumstances, flu viruses can survive up to 17 days on the surface of cash. Considering the heightened dangers we currently face, preparing your business to accept cashless and card-not-present transactions has never been more crucial. As it happens, some restaurants and grocery stores have already gone card-only or are prioritizing cashless payments — some having done so years before the current pandemic. This shows that these measures, while difficult and not without their trade-offs, can indeed succeed.

We understand that the nature of certain types of businesses will preclude the possibility of everyone doing this at scale, but we’re going to detail how you can accept payments from your customers without involving the exchange of cash or even a credit/debit card. At the same time, we have to acknowledge the extra costs and work involved in upgrading your payment infrastructure. It’s our goal to help you minimize the time and money you’ll have to devote to this transition.

One consideration we must acknowledge is the fact that cash payments get to merchants sooner than most forms of cashless payments. If you’re concerned about the effect that moving to cashless and card-not-present payments will have on your cash flow, have a look at our article on managing your business’s cash flow.

You Have Alternatives To Cash & In-Person Card Payments

If you’re considering shutting down your office and switching your business to delivery-only, know that you can get paid without having to send out invoices. Thankfully, you can accept payments both online and, via a virtual terminal, over the phone. If you haven’t gone this route in the past, we’ll explain how it works.

Of course, accepting these kinds of payments presents some challenges. As we’ll get into, there are security issues you’ll have to consider as well as some logistical challenges. For example, card-not-present transactions carry a higher risk of chargebacks than do card-present transactions. Check out our piece on preventing and winning chargebacks to learn how to minimize this risk.

Security Concerns For Card-Not-Present (CNP) Transactions

When accepting payments remotely, you’re responsible for ensuring the security of your customers’ payment information. The key to achieving this is to make sure that your payment system is PCI-compliant.

Merchant Maverick does have a complete guide to PCI compliance — what it means and how to bring your business into compliance — but we’ll summarize the main points here.

• PCI compliance refers to a set of standards established in 2006 to ensure the security of all customer payment information that is sent and received online
• Some of the practices that will help ensure your business remains PCI compliant include:
  • Use only PCI-validated payment gateway software
  • Don’t store any sensitive cardholder data
  • Use a firewall on your network and computers
  • Never use default passwords
  • Check that your wireless router is password-protected and uses encryption
  • Check your terminals, PIN pads, and computers to ensure that no one has installed rogue software or “skimming” devices
  • Educate your employees about security and protecting cardholder data

If you don’t take the steps necessary to protect your customers’ credit card information properly, you could easily suffer a data breach that puts your customers’ finances at risk — a development which would not reflect well on your business and lead to a general loss of trust in your enterprise.

Again, please refer to our PCI compliance guide for more detailed information on how to maintain best practices and keep your customers’ payment data safe from hackers and other bad actors.

How To Accept Over-The-Phone Payments

Businesses in certain industries are more likely than others to be familiar with the ins and outs of taking payments over the phone. For instance, restaurants often use POS systems that include a feature for taking orders remotely and processing remote payments. If you operate a restaurant, there’s a good chance that your POS provider offers capabilities that you may not have had reason to explore in the past. Contact your POS provider and ask about the availability of these features if you’re not sure.

Alternatively, many businesses may find that a virtual terminal is their best option for accepting payments over the phone. For those who don’t know, a virtual terminal is a means of accepting credit card payments without the credit card being physically present. They are typically web-based and involve you entering your customers’ credit card information into a secure web page for processing. Service businesses have particular reason to like this arrangement. Why wait around for a check when you can just take a card number over the phone?

Many POS systems and virtual terminals have a vault feature that keeps your customers’ information stored on file for later use. It allows your customers to simply direct you to charge their card on file when making a purchase. This practice is acceptable from a security standpoint because the information is not stored on your site or your devices. Instead, it is all encrypted and stored with the processor.

Here’s a good primer on card-not-present transactions.

How To Accept Online Payments

Paying for goods and services online has become commonplace over the last few decades — although your business may not have experience with how it all works. In this section, we’re going to run through some common scenarios and let you know how to accept online payments in each instance.

Online Restaurant Orders

Most modern restaurant POS software will include online ordering and delivery functionality (along with payment processing, of course). If you have such a system and you haven’t taken advantage of these features yet, contact your POS provider and ask about how you can implement them. And if you’re trying to sign up for a restaurant POS system, so you can accept payments online, ask the provider in question about payout times. A waiting period of around two days is fairly standard in the industry, though some processors offer faster payouts.

For more information on running a restaurant in the age of COVID, we’ve published a guide on how to best implement your own in-house delivery system as well as a rundown of the best third-party delivery services if you’d rather go that route. Merchant Maverick also has a guide for setting up an online ordering system.

Retail eCommerce

If you’re running a brick-and-mortar establishment and you’re setting up eCommerce for the first time, your existing credit card processor should be able to help you set up your online eCommerce system.

If you find that your current payment processor doesn’t allow you to do what you’d like with respect to online sales, you could always switch to a third-party processor, such as Square or PayPal. Establishing an account with the likes of Square and PayPal is incredibly easy and painless, so while this isn’t an ideal time to go comparison shopping for a new payments provider, the option is there should you want to take advantage of it, and it shouldn’t take up too much of your time.

An attractive and functional website can be an excellent springboard for your eCommerce system, which is why we’ve also published a guide to creating a great website for your business.

Invoices & Online Payment Forms

If you’re trying to further reduce the need for in-person exchanges of payment, you can use invoices and payment forms to send custom links to your customers that allow them to enter their credit card information remotely. This has the benefit of being safer than the use of old-fashioned paper invoices and checks.

Also, online invoices and payment links are faster and more efficient than waiting for a check. This is one case where there’s no trade-off between safety and speed/efficiency — online payments have an advantage over paper invoices/checks in both respects.

Here is an informational article that details the invoicing process.

How To Switch Payment Processors If You’re Not Happy With Your Current Setup

A global pandemic is not an ideal time for any business to be trying to switch up their payment processing system. However, as the established ways of doing business are being upended at a dizzying pace, businesses everywhere will have to adapt to both remain viable and protect the health and safety of employees and customers alike. To that end, here’s what you need to keep in mind when considering whether you should change your current payments setup.

• Does my current payment processor offer the features I need to implement online and over-the-phone orders?
• Has my processor’s approach to dealing with this crisis been appropriate, or is my processor being unhelpful or opportunistic, thus making things worse?

If you’ve concluded that a switch is in order, here’s what to watch out for.

Early Termination Fees (ETFs)

Some merchant account providers make you pay an extra fee to get out of your contract early. This penalty may come in the form of a flat fee, or it may come in the form of liquidated damages — i.e., all (or a portion of) the fees they expect to make from you during the entire term of the contract. We hate to see this happen.

Luckily, you may be able to get out of paying an ETF, even if your contract includes one.

• Find out the precise date when your contract ends, then find out how many days in advance of the end date you have to notify the processor that you wish to cancel. You may just get lucky and find that you’re in or near the window of time in which you can cancel your contract without penalty.
• If the above option isn’t available to you, you may want to, in the parlance of our times, “speak to the manager.” Specifically, if your salesperson neglected to tell you about all the monthly fees you have to pay or if your equipment didn’t work as advertised, you may have grounds to go to the higher-ups and contest your ETF. What’s more, payment processors dislike bad press just like any other company, so threatening to take your case public may pay dividends in this regard as well.

Read our article on early termination fees for more information on how you may be able to switch processors without paying them.

Automatic Renewal Clauses

If your merchant account agreement includes an auto-renewal clause, you may be on the hook for another one, two, or even three years of service if you don’t cancel within the window of time stipulated in your contract — typically about 90 days before the end of your original contract agreement.

• Even if you’re in your contractually-specified window of opportunity, you’ll need to submit a request to your provider to cancel your account in writing — you probably won’t be able to do it over the phone successfully.
• If you’re not near your window of opportunity but are still eager to get out of your contract, you can always try contacting your provider and pleading your case, taking note of the historic, unprecedented circumstances you’re dealing with. Again, payment processors are as averse to bad press as any business (hint, hint).

Read our article on auto-renewal clauses to get a fuller sense of how they work (and how to avoid them altogether if you’re shopping for your first payment processor).

Accepting New Payment Methods Is Still An Investment In the Future

You don’t need me to tell you this, but times are tough. Businesses everywhere have been subject to tremendous challenges as the COVID-19 pandemic changes the way we work, shop, and live. Trying to adapt to new payment acceptance technology at this particular moment in time may seem particularly daunting. However, doing so will help ensure that your business has the best chance possible to survive this pandemic. You’ll also be positioning your business for success in the long-term, as these new methods of accepting payment will continue to become more commonplace long after the pandemic ends.

For more information on payment processing and how to find the right provider for your business, check out the following resources:

• How To Negotiate The Perfect Credit Card Processing Deal
• How To Read, Understand, & Successfully Negotiate A Merchant Agreement For Your Small Business
• Six Signs Your Small Business Needs To Switch Payment Processors
• How To Choose A Merchant Service Provider: 7 Things To Look For

Lastly, we’ve been adding resources to our COVID-19 resource hub continuously, so you’ll want to keep checking it as the situation develops. Our comprehensive Small Business Outbreak & Pandemic Guide: Coronavirus Edition is another great resource for getting your business through this tragic time in our history.