LUTZ BUSINESS INSIGHTS
Does Your Business Need a Merchant Account?
MIKE PERRY, CLIENT ACCOUNTING SERVICES DIRECTOR
Your company’s cash flow isn’t the only element of your accounting that helps you gauge your financial status, but it’s certainly one of the top five. There are numerous things you can do to improve it, like:
- Revisiting and enforcing company expense policies.
- Making global pricing increases so no one item gets hit too noticeably.
- Doing year-round tax planning to try to minimize your liability.
There’s another change you can make that should help accelerate the speed of customer payments and even out your cash flow: Start accepting remittances via credit cards and electronic checks.
Numerous companies offer these merchant accounts. There are fees associated with them, so you can certainly comparison-shop and consider solutions like Stripe and Shopify. Intuit, though, offers its own merchant services, which simplifies integration and support issues.
When you offer customers the ability to pay their bills online, you gain more than speed. Other benefits of signing up for a merchant service include:
- Accuracy. Payments are transmitted directly to your bank account (usually within 2-3 days), minimizing the chances of incorrect data entry.
- Invoice “intelligence.” You’ll be notified when customers open and pay their invoices.
- A savvier image. If your business doesn’t accept any kind of electronic payments, what does that say about your level of technical sophistication? Whenever you can make things more convenient for your customers, their perception of your credibility and your concern for them becomes more positive.
It doesn’t take long to get set up with an Intuit merchant account. You, of course, have to be using QuickBooks desktop or QuickBooks Online. You’ll first be asked to complete and submit an application that asks for contact information and other details about things like your business type and an estimate of the amount you’ll process monthly (if it’s more than $7,500, you can save up to 40 percent on rates).
Once you’re approved, you’ll need to go to your QuickBooks settings screens. Here, you’ll answer a few more questions and provide the routing and account numbers for the bank account that will receive customer payments. Once you’re done there, you’ll be able to receive funds in person and over the phone, either by entering account data or swiping a physical credit card.
You can also include a payment stub with invoices you send via email, which allows your customers to enter their payment details and return the form electronically. If they’re paying immediately for a purchase, you’ll create a sales receipt to record the funds being transferred electronically. QuickBooks offers dedicated tools to process every type of transaction, including a free card reader for swiping.
Your Financial Obligation
The only real downside to having a merchant account is its required fees. Talk to us if you’re ready to get started offering your customers this service – and benefitting it from it yourself.
ABOUT THE AUTHOR
MIKE PERRY + CLIENT ACCOUNTING SERVICES DIRECTOR
Mike Perry is a Client Accounting Services Director at Lutz with over 15 years of accounting experience. He focuses on providing business consulting, software implementation and training, accounting procedure assistance and outsourced accounting replacement consulting for closely held companies.
AREAS OF FOCUS
AFFILIATIONS AND CREDENTIALS
- American Institute of Certified Public Accountants, Member
- Nebraska Society of Certified Public Accountants, Member
- Intuit Certified ProAdvisor, QuickBooks Advanced
- Certified Public Accountant
- BSBA in Accounting, University of Nebraska, Kearney, NE
- Community Bike Project Omaha, Past Treasurer
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