“Credit Card Processing: Are You Compliant?” by Sensei’s Sharon Nelson and John Simek was featured in the September issue of the Wisconsin Lawyer. The Wisconsin Lawyer is a publication of the State Bar of Wisconsin.
Excerpt: Does your firm accept and process credit cards? If not, you probably should. Clients are more apt to pay their retainers or your invoices if they can use a credit card instead of writing you a check. The way you process credit cards is about to change in a big way (for all businesses), but let’s start at the beginning.
The first step in processing credit cards is getting a merchant account. A merchant account is essentially a contract with a “processor” that takes your transactions and processes them with the credit card companies (e.g. MasterCard, VISA, American Express, Discover, etc.). When you work with a processor, you will pay a variety of fees (e.g. discount percentage, transaction fee, etc.) for each one of your credit card transactions. Typically, the discount percentage will go down as you gather more and more information to validate the transactions. As an example, the discount rate will be lower if you have the cardholder’s complete address (including zip code) and CVV (card verification value) versus only having the billing zip code. Companies such as LawPay, Sage Payment Solutions, Square and Authorize.net are credit card processors.