When it comes to taking credit card processing there are two ways to go:

Traditional Merchant Processing

• Payments are accepted using a card swipe terminal, point-of-sale (POS) system, cash registers, website, or a smartphone (iPhone,  Android or Blackberry)
• Merchants pay a monthly and annual fee and "processing fees" are charged to the merchant for each payment.
• Processing fees are hidden from the customer.
• Chief advantages: familiar to payers, compatible with most existing retail and ecommerce systems, mobile device convenience.

Payment Portal

• Payments are accepted by either the merchant's staff entering them on a website or the customer making their payment through a website.
• Merchants pay a monthly and annual fee.
• The customer (payer) is charged a convenience fee at the time of purchase.
• Chief advantages: Up to 95% savings, enables credit card payments in industries with regulated prices or accounting rules, allows for card payments for pre-negotiated prices after a contract is signed.

What's Right For Your Business?

The important thing is to do what will be best for your firm, and your customers. Usually the answer depends on three factors:

1. Can you accept less than 100% of the amount being paid to you? (If you take a $1000 payment, are you ok with getting $960-980?)
   If yes, go with traditional merchant processing.
   If no, go with a Payment Portal solution.
2. Do you want to offer credit card payments as an option to customers, but would prefer to get cash or check payments?
   If yes, go with a Payment Portal solution as the convenience fee will provide incentive to pay you using a lower cost method like a check or credit card.
   If no and you are okay with a larger number of credit card payments, go with traditional merchant processing
3. Is your industry a highly competitive retail business?
   If yes, go with traditional merchant processing as that is what customers will expect.
   If no, then your customers may be more open to paying a convenience fee as opposed to a 3-5% price hike across the board.

Virtual Payment Systems offers both traditional merchant processing and an innovative payment portal service called VPS Portal.