Small businesses sign up for cheap virtual credit card merchant facility

Easier access to credit-card payment facilities will help New Zealand small businesses find international markets, and ensure local customers pay their bills on time.

Swipe HQ Checkout is a virtual credit-card merchant facility that allows businesses to accept credit card transactions without the need for a terminal and at a lower cost than its competitors.

Created by Kiwi cloud technology company Optimizer HQ, the new gateway will reduce the cost for small businesses wanting to offer e-commerce and make it easy for tradespeople to offer their customers credit card payment alternatives.

Optimizer HQ Chief Executive Manas Kumar says in the past, low volume online traders have struggled to make an e-commerce venture profitable as banks and offshore payment gateways charge a fixed monthly fee on top of an initial set-up cost and other fees, which can be more than 4.5 per cent.


His business will charge a 2.75 per cent flat cost per transaction and 0.65 per cent for registered charities.

In the first three days of being available, Swipe HQ has signed up 50 businesses.

Kumar says the payment structure makes sense because businesses will only pay if they are making money.

Traditionally, people wanting to take credit card payments have to pay a set-up fee of up to $200, a monthly fee of $25 to $35 and then about 3 per cent per transaction.

"Sixty per cent of New Zealand business owners aren't on the web yet," Kumar says.

"That means two-thirds aren't tapping into export revenue. We thought perhaps one of the factors was the difficulty in getting set up with credit card payments."

People who regularly send invoices to their clients can upload the invoice to the Swipe HQ system. It will then email the customer a link to the invoice and credit card payment options.

Swipe HQ will offer a credit card reader for smartphones in the next few months.

Local crew clinches it

Simon Lockie (picture), of Auckland flying school Flywest, installed Swipe HQ Checkout this week.

He said the lower cost was appealing but the main attraction was that the Swipe HQ support team was in New Zealand.

"We've been using PayPal and they are big but don't particularly care much about their customers."

Flywest will be at Big Boys Toys with an iPad running the Swipe HQ system.

Lockie said in the past, not having electronic payment options had cost them sales at similar events.

"It was going to cost $200 for the weekend with mobile Eftpos. That's quite a lot for a small-margin business."