If you can pay for a 95¢ pack of gum with your credit card, then you should be able to use your card for that antique mahogany desk at the craft fair! The new smartphone card readers, aside from looking super cool, are also highly functional. Being able to accept credit cards anywhere at any time, regardless of whether you have a brick and mortar store, or are a local artist, can dramatically increase your sales and streamline your invoice process as well.

While there are probably around a hundred card processing apps available for different smartphones (iPhones win out here), only a small number of companies have joined an app to a specific card swiping device. See how they all compare before you decide which one is best for your business.

Square

Perhaps the smallest card reader on the market, Square is also one of the most easily recognizable devices. About the size of a book of matches, Square plugs directly into the audio jack and can be used on most iPhones or Android phones. Both the device and app are free, and no contract or merchant account is required, so money goes straight into your bank account.

It looks sleek, is easy to use, and allows you to make refunds easily. Square’s pricing plan is equally as simple. For every card swipe, Square takes 2.75%. However, non-swipe transactions incur a fee of 3.5% plus 15¢.

There are tons of other non-swipe card processing apps for the iPhone. Some of these are: Pocket Terminal (can handle multiple business accounts), iPay POS (compatible with dozens of the most popular payment gateways), ProcessAway (recurring billing), SWIPE (cheap app with lots of features), and many more.

Intuit GoPayment

Intuit GoPayment is similar to Square but with two distinct differences. While Square only works with Apple and Android products, Intuit GoPayment is also compatible with BlackBerry devices (Note: only the app, not the card swiper). This service also gives larger businesses the option of signing up for a $13 monthly plan with reduced transaction fees of 1.7% (swiped) and 2.7% (non-swiped). The app and card reader are free, and money is deposited right into your bank account.

Last year, fraud costs businesses $8 billion. If your business accepts credit cards for payment, then you’re vulnerable to chargebacks caused by these fraudulent transactions. Setting up a fraud scoring system can help stop fraud before it starts, and save you time and money down the road.

Fraud scoring is a set of operating procedures and technologies that are implemented to identify suspicious transactions. If a purchase looks like it may be fraudulent, the system can detect it and either reject it altogether, or request additional authentication before the transaction is processed.

Good fraud scoring systems will measure the risk of the transaction by gathering and analyzing relevant information about the purchaser, including: the amount of the purchase, the IP address from which the transaction was made, the email address of the purchaser (free emails may be particularly worrisome), where the purchase is being made from, when the order is placed and what shipping options the purchaser is using.

After your fraud scoring system is setup, it’s important to tweak it as needed. Fraud is more prevalent in some businesses than others and you’ll need to adjust your system accordingly. Ideally, this is done through a fraud score, which takes a broad range of indicators and creates a single metric by which to judge the riskiness of a transaction.

The prospect of setting up a custom fraud scoring solution can be daunting, to say the least. Fortunately, there are many off the shelf solutions, like MaxMind, which are far more cost effective for small businesses.

In January 2011, the National Retail Federation, the world’s largest retail trade organization, along with First Data Corporation released results from its latest research study. The information collected from the subjects involved evaluated the data security and fraud prevention strategies practiced at small to mid-sized retailers. In addition to shedding some light on the industry’s current standards, this study also identified many areas of opportunity.

Despite some favorable data, a majority of retailers demonstrated an apparent lack of understanding with regard to the specific types of liability that they could be held accountable for in the event of a data security breach. In fact, an alarming 35% of retailers did not know that they are required by the state to notify credit cardholders through their banks if the information listed on the customer’s credit or debit card was compromised. Disregarding policies like these leaves consumers in the dark when it comes to the security and protection of their personal information.

There are a number of ways that consumers can protect themselves from billing security perils. Here are a few things to consider before trusting a bank or financial institution with your private data:

There have been several articles in the news lately involving credit card mishaps & billing mistakes.  Capital One billed a woman $286 million dollars, Gameloft (a mobile game developer) double-charged a number of customers and the Minnesota Attorney General is suing Discover for signing people up for credit card protection they didn’t request.

No wonder customers are apprehensive about giving out their billing information!

The good news is there are things we can do to ease our customers’ fears when it comes to their credit cards…. and they are pretty simple.

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If you use Chargify you know we have both an online dashboard and an iPhone app to help you keep track of your company’s key metrics. You can see daily revenue, new signups, total customers and more.