Turn your iPhone into a credit card terminal

real_people_pat_jackson.top.jpgAfter years of frustration, Pat Jackson finally found affordable technology to let her mobile repair technicians bill customer's credit cards.By Jennifer Alsever, contributing writer


(CNNMoney.com) -- For years, small business owner Pat Jackson struggled to find an affordable way to let customers pay for heating and air conditioning repairs with their credit cards at home.

The owner of Jackson Comfort Systems in Northfield, Ohio, once tried out a credit card processing service from Nextel, but her technicians hated the bulky phones it required. Then she looked into options from AirCharge and United Bank Card, but those services were pricey: up to $250 for portable credit card machines and $25 per month, per truck for wireless service.

Eventually, she asked her 27 technicians to simply write down customer credit card numbers. Payments would get processed in her office. But that led to errors and higher credit card fees. Plus, customers didn't like it.

"It was frustrating," says Jackson. "We pride ourselves on good customer service, and that meant we weren't giving it."

But in May, Jackson received a flyer telling her about a new service called GoPayment from Intuit (INTU). For $20 per month, Jackson's technicians can use their existing cell phones and text messaging services to process payments. Instead of waiting weeks to get paid, Jackson Comfort Systems gets its money on the spot.

Paying with plastic has been the norm for years, but for many small businesses like Jackson's that operate remotely, it has been an elusive benefit. Out on the road, options were limited: buy cumbersome machines for hundreds of dollars, call the office with credit card numbers, or simply miss a sale by refusing to take credit cards.

Now, photographers, contractors, limo drivers and dog trainers -- any business that operates remotely -- can find a wealth of new software to process credit cards on mobile phones.

Apple's (AAPL, Fortune 500) iPhone has been a big driver, with a slew of new applications popping up in the last year. Users type a credit card number and expiration date into the phone, and have the customer "sign" on the phone's screen.

"Now we have some small businesses that are running their whole businesses off the iPhone," says Derek Del Conte, co-founder of Inner Fence, which developed the first iPhone application for processing credit cards.

Inner Fence's app costs 99 cents to download and then $25 a month. Each transaction costs 25 cents, plus 2.09% to 3.79% for fees charged by the credit card companies. The app also lets business owners issue refunds, review prior sales and email PDF receipts of their transactions.

GoPayment, the service that Jackson uses, requires a $60 setup fee and a $20 monthly fee, plus a $0.23 per-transaction fee and 1.64% to 3.54% for credit card processing fees.

Jackson decided to spend an extra $1,000 extra to buy 10 pocket-sized Bluetooth credit card swipers that work in conjunction with the cell phones. She reserves them for when she rings up bigger sales. Using a swiper lowers the credit card fees -- it's an anti-fraud measure adopted by the processing companies.

Jackson estimates that the swipers save her $600 a month in fees. For her company, which has annual sales of $3.2 million, the entire investment in mobile credit card processing paid off within a couple of months.

"It saves us a bunch of money at a time when business costs are increasing," she says. "The customers like it, and the technicians like it -- and they never like any kind of changes." To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Questions & Answers



QHow does a florist sell more in this economy? We changed our business to designing weddings and events only, as the everyday flowers are not selling. We had to throw out too much product at the end of the week -- flowers are perishable! More
Get Answer
- The Flower Lady, Suwanee, Ga.
Overnight Avg Rate Latest Change Last Week
30 yr fixed4.28%4.41%
15 yr fixed3.30%3.33%
5/1 ARM3.30%3.34%
30 yr refi4.31%4.39%
15 yr refi3.35%3.31%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 16,471.66 -29.99 -0.18%
Nasdaq 4,112.17 -14.80 -0.36%
S&P 500 1,873.87 -1.52 -0.08%
Treasuries 2.69 0.00 0.07%
Data as of 10:09am ET
Company Price Change % Change
Facebook Inc 60.82 -0.54 -0.88%
Bank of America Corp... 16.28 -0.09 -0.55%
Apple Inc 564.25 39.50 7.53%
Verizon Communicatio... 46.67 -0.76 -1.60%
General Motors Co 34.67 0.28 0.81%
Data as of 9:54am ET
Sponsors

Sections

Billionaire advocates for increasing a tax credit on wages as a way to attack the growing inequality in the U.S., but he's unsure of the benefits of raising the federal minimum wage. More

Apple increased its buyback and posted a strong second quarter, sending shares soaring. More

Schwinn, Trek and Cannondale are all iconic American bicycle brands. But none of them are made in the United States. More

When you are just starting out or finally starting to get serious about saving, the basics will get you far. Here are more than a dozen tips that will help you lay the base for building your net worth. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.