• Small business’ new best friend: Mobile payments


Recent articles by Boston.com and Fast Company point to a new idea that could help small businesses avoid the dilemma of choosing between cost and convenience. For small business owners, the fees associated with customers using credit cards can be burdensome. Some companies might choose to accept the fees, which usually range between 1.5% to 3% of each purchase. Many customers rely on credit cards in their day-to-day lives. Other companies are forced to forgo accepting credit cards due to expensive processing fees, which can hurt their customer base.

Scvngr, a Cambridge-based start-up, recently announced a big change to their mobile payment software app, LevelUp. They will no longer be charging processing fees for merchants utilizing the app, which links an individual’s credit or debit card to a unique QR code. This allows customers to pay for products and services with a simple scan of the code on their mobile screen. Prior to this recent development, LevelUp, which has been around since 2011, used to charge merchants 2% of each purchase total.

Dubbed “Interchange Zero,” the elimination of processing fees is possible due to the other services LevelUp provides to merchants. The company charges 35¢ for every dollar of credit used by customers via a LevelUp Campaign. Through LevelUp, merchants can offer incentives to new customers and loyalty rewards to build and maintain a strong customer base.

LevelUp is not alone in the world of mobile payment apps, but they are the first to eliminate processing fees. Now Square, too, has changed their policies. They are now offering lower, monthly fees for small businesses who bring in less than $250,000 per year instead of the usual per-transaction fee. As this movement gains ground, it will be a trend that is good for both small businesses and their customers. So now, customers still get the ease of payment that they want and businesses don’t have to incur the extra costs.

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