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How to Accept Credit Card Payments Over the Phone

How To Accept Credit Card Payments Over The Phone

Facts: everyone carries a credit or debit card now, and barely anyone pays with cash anymore. For your business, making sure you can take cards in every way possible should be a top priority.

Accepting credit cards over the phone can help that crucial close, and also quickly and radically increase your efficiency.

From cafés to warehouses, taking and processing orders over the phone is just a norm- so when that big call comes into your business, you better be ready to take it.

What You’ll Need

Merchant Account Provider Or Payment Service Provider

A merchant account provider supplies your business with the aforementioned account plus all the hardware and software tools to take credit card payments.

Fees can be extensive and require an application process & contract, but are regarded as very secure.

Payment service providers transfer funds directly into your business account. Fees are fewer and service is instant, but you can face issues such as withheld funds or frozen accounts.

Virtual Terminal

A virtual terminal is typically provided for by either of the above, allows you to key-in card transactions, includes security measures, and electronic receipts.

It also potentially securely saves payment information for repeat business.

What Does It Cost To Accept Credit Cards Over The Phone?

This will entirely depend upon your plan with your credit card processor; although as a rule, accepting payment over the phone will cost you more than taking payment in person.

Most charge a rate between 2% to 4% per transaction; for card-not-present transactions, increased risk pushes that rate up.

It’s also common for credit card processors to add a fee for payments over the phone, which they also see as higher risk.

Is It Safe To Pay Over The Phone With A Credit Card?

The obvious risk when a customer pays over the phone is that they are not the actual card user, which is why credit card processors raise their rates for so-called ‘card-not-present’ transactions- which includes those accepted over the phone.

Avoid unscrupulous transactions over the phone by taking the necessary steps to stay savvy:

Require everything: Over the phone, you should require complete card information: card number, expiration date, security number and the name as it appears on the card.

Request complete billing and shipping addresses with ZIP codes- and take a phone number.

Use a secure POS system: The top POS systems are capable of checking a customer’s account themselves, and will make your transactions much more secure.

Confirm delivery: Confirm delivery of all products shipped to a phone-paying customer. A record of delivery will all but confirm a legitimate transaction.

Match ZIP codes: If the billing and shipping address ZIP codes don’t match, don’t be afraid to ask why. There are plenty of common reasons, but if the answer doesn’t sound right you’re better off asking for the customer to use a different payment method.

How To Take Credit Card Payments Over The Phone

When you have access to a virtual terminal/POS system with the ability to take card-not-present transactions, you are ready to begin accepting credit card payments over the phone.

1. Determine Which Credit Card Information Is Required  

Payment providers and POS systems have different requirements for the amount of credit card information.

The more information gathered the more secure your transaction is, but check your provider’s individual needs.

The following information is almost certainly required to process a credit card through your virtual terminal:

  • Card number
  • Expiry date
  • Security code.
  • Customer name/name on card
  • Billing address

You may also require the type of card (Mastercard, Visa, etc.), customer address, email, phone number etc.

If you’re shipping, then you’ll obviously need the customer’s shipping information (which may vary from their Billing information). If you’re going to be sending email or text receipts, you’ll need those details too.

2. Take The Customer’s Order 

While your customer is on the phone with you, input their order details into the system and calculate the total, (incl. sales taxes and shipping costs). Run the full order and this total by your customer before confirming.

3. Ask For Credit Card Information, Key Into Terminal And Submit 

Your virtual terminal will notify you when the transaction has been approved. If the transaction has been declined, you need to reconfirm the details with your customer or ask to use a different card.

4. Send Receipt And Complete 

You may be able to send an email or text receipt from your system, or even print one to mail to the customer. You need to save a receipt and any additional information for your business records.

As mentioned earlier, card-not-present transactions pose a higher risk. Note anything worthwhile regarding the sale and your phone call with the customer for later. Hopefully you won’t need it.

Can I Take A Phone Credit Card Payment With PayPal?

Payment via credit cards through PayPal online is already accepted by many businesses. To do this, you’ll need to pay for a virtual terminal in addition to PayPal’s credit card fees.

This functions similar to any other virtual terminal, although you need an internet connection.

What Are The Drawbacks Of Taking Credit Cards Payments On The Phone?

Allowing customers to pay over the phone carries a heightened risk of fraud. Take the customer’s complete info, invest in secure payment systems only, and build a paper trail.


Don’t throw security out the window just because you’re a small business and you need the cash- secure practices will protect you and your customers in the long run.

Entitled customers will expect to pay how they wish, but the best way is what protects you (and them, even if they don’t know it yet!). 

Make sure you are aware of all the safest ways to perform a transaction, and make sure that your staff are trained in all the best practices, and that they know the risks.

Thank you for reading!

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