What if you could accept mobile payments for free? Sounds too good to be true, doesn’t it? Small businesses with big orders can rejoice over the fact that PayPal is making it possible. However, as with most things in life, there’s a catch. On the other hand, this could result in small businesses saving thousands of dollars in transaction fees before the end of the year.
PayPal is offering businesses the ability to accept credit and debit cards for free. Throughout the rest of 2013, PayPal is running a program called Cash for Registers that will eliminate the transaction fee associated with accepting credit or debit card payments. Any small business owner understand how these transaction fees can eat away at their profits. Many small businesses still require customers to spend a certain amount in order to pay with a credit or debit card. With this program, PayPal hopes to increase small business profits, but not without a catch.
What’s the Catch?
Businesses must turn in their previous point of sale system and use PayPal’s Here POS or any other point of sale system that uses PayPal. In other words, you’re taking a small gamble to receive these free transactions. Once 2013 is over, the fees will return to normal. This may leave business owners switching services again to get the best deal on transaction costs. PayPal currently charges 2.7% per transaction, which is actually one of the best prices of mobile payment applications.
Is It Worth It?
With less than 7 months remaining, many businesses may question whether or not switching POS providers is worth it. Businesses that do thousands of dollars in transactions will certainly benefit. At a meager transaction fee of 2.75% a business that stands to make another $100,000 this year could save $2750! That’s no small chunk of change. Chances are you’re paying more than that per transaction, which means you stand to save even more money. On the other hand, businesses that are barely making $1000 a month in sales may find the hassle of switching providers too time-consuming to fool with.
Transaction fees can result in thousands of dollars of lost profit each year. PayPal is offering to help carry the load until the end of the year. With the ability to cut hundreds or thousands of fees from your profits, it only makes sense to make the switch to PayPal. In fact, you may find that once the year is over, your transaction fees are lower than the previous POS system you used. If not, you can always switch back to services you know and trust, like Moblized and others.