Avoid Common Mistakes While Accepting Payments from Credit Card

Credit card payments are one of the most preferred payment methods opted for by urban consumers. The idea of spending on credit and paying later without any extra charges allows customers to shop freely. Not to mention, it increases the shopping tendency of an individual when the psyche of ‘pay later’ or ‘pay via EMI’ settles in. Consequently, merchants accepting credit card payments tend to report more sales than their peers who do not accept credit cards.

Nearly 58 million credit cards were active in India as of August 2020. This figure is set to scale to newer heights, with the Indian credit card industry projected to grow at a 25% CAGR by 2025. With more customers relying on credit cards for making payments, businesses can expand their customer base by a considerable margin when they accept credit card payments. It is, however, necessary for businesses to recognize and avoid common mistakes that most merchants make while accepting credit card payments. Mistakes like not checking the payment gateway charges while accepting card payments can burn a hole in a merchant’s pocket rather quickly. There are many such errors with credit card payments that can affect a business dearly. Following is a comprehensive list of such mistakes that merchants need to be aware of.

Mistakes to avoid while accepting credit card payments

  • Not Choosing the Right Payment Processor

A payment processor is a hardware device or a gateway that collects the customer’s card details and links them up with the bank to check its authenticity. Post verification, the bank processes the payment. There are several processors that merchants can choose from. Brick-and-mortar businesses need to have a POS terminal, which is a physical device. On the other hand, online businesses have to make payment gateway charges and register for a gateway. Researching for the most suitable processor is essential. One must also check the amount of time it would take to set up the account.

  • Choosing the least expensive Payment Gateway

It is human psychology to shop for a service at the lowest cost. The same tendency dictating the purchase of payment solutions can be harmful in the long run. Low payment gateway charges might also indicate some hidden charges. Businesses need to compare the several available options, their features, cost, reliability, among other things. Cost-benefit analysis is essential. Choose a payment gateway that is affordable and has features strong enough to support the business for years to come. A cheaper alternative may cause glitches with credit card payments or may support limited card network providers.

  • Ignoring Security

Safety is also crucial to building customer trust and getting an edge over the competition. No customer would want to make a payment via an insecure gateway. Payment Card Industry Data Security Standard (PCI DSS) is a set of regulations that protect the customer’s card details against fraud, providing maximum security. This also means that the gateway must be updated with the latest technology regularly to avoid cyber-attacks. Gateways like Zaakpay provide protection against all these terms for nominal payment gateway charges.

  • Not Reading Terms and Conditions of the Payment Gateway

The merchant has to agree to the terms and conditions of the gateway service. Not reading the fine prints initially can make it difficult for the business later.

  • Not Promoting Facility to Pay by Credit Cards

While shopping from some small businesses, customers often abandon the purchase thinking that the business would not accept online payments. Small businesses should promote what payment modes they accept as much as possible by mentioning on the website or using logos of different cards they accept. This assures the customer that the business accepts their payment mode.

  • Not Reviewing Monthly Transaction Statements

It is essential to choose a gateway that generates and shares proper logs of all credit card transactions. This not only makes the accounting process easy but also helps in avoiding fraudulent transactions. The merchant should scrutinize the monthly statements regularly. Some gateways are integrated into accounting software for easy data maintenance.

  • Not having a Chargeback Policy

A chargeback is a process that the customer can initiate when they request their bank to reverse a payment made through the credit card. Many customers use this method for fraud and duping merchants, and it is terrible for the business. The merchant will have to bear the fees, but multiple such requests can lead to a ban from the gateway services as they might perceive the business as a fraud. To avoid such situations, it is best to have a laid-out cancellation or refund policy. It should be communicated to the customers while purchasing. Refunds, if required, should be processed within the stipulated time.

  • Avoiding Customer Support

Customers might want to connect with the business for several reasons. They might want to get more in-depth knowledge about the product or have questions about the payment process. Reverting to the customers without delay is crucial to maintaining good customer relations. This also helps to avoid chargebacks. Customers who have a good experience with the business are sure to return to it again.

  • Discounting the risk factor

The risk with credit card payments is high for merchants. Apart from chargebacks, multiple other threats are looming over, especially with high-value credit card transactions. In addition to this, customers have a six-month window to raise a ‘disputed transaction’ with their banks. It is vital not to overlook these potential risks and be ready to combat these instantly.

  • Not being future-proof

Technology is changing every day. The gateway chosen should be future-proof and flexible. The business might also need more efficient and robust features to scale up as it grows. Choosing a technology that can be modified as and when required can save up money later on while scaling up.

  • Not asking the right questions

When merchants shop for a payment gateway or a PoS terminal provider, they must ask critical questions. Any question plays an integral role in how customers make payments. Questions like, “how many card networks do this support? How soon can I start accepting credit card payments? Does this work for customers shopping via mobile phones too?” can help merchants avoid the mistake of choosing the wrong payment gateway.


Accepting credit card payments can easily give a boost to sales. Merchants can capitalize on this to earn more significant revenues. To avoid losing out on money due to common mistakes, as mentioned above, it is important to understand the payment system. Through thorough research, businesses can avoid making such mistakes. For small businesses, Zaakpay is an excellent payment gateway. It allows accepting digital payments from a broad category of payment services and has affordable payment gateway charges.

Cheryl Henson

Cheryl Henson is a passionate blogger and digital marketing professional who loves writing, reading, and sharing blogs on various topics.

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