If you’re a small or medium-sized business owner in Los Angeles, accepting credit card payments is essential. Choosing the right method can impact your costs, security, and customer experience. In this guide, we’ll break down four kinds of credit card processing for merchants, helping you find the best option for your business.
1. In-Person (Card-Present) Processing
How It Works
This is the most traditional form of credit card processing. Customers physically present their cards and complete a transaction by inserting, swiping, or tapping at a payment terminal.
This method requires a Point-of-Sale (POS) system, a card reader, or a smart terminal to process payments. Modern POS systems also accept contactless payments like Apple Pay and Google Pay.
Benefits for SMBs
- Fast and Secure Transactions – With EMV chip technology, in-person transactions are much more secure than traditional magnetic stripe swipes.
- Lower Fraud Risk – Since the card is physically present, there’s less chance of fraud or chargebacks.
- Contactless Payments – Mobile wallets like Apple Pay and Google Pay make checkout faster and more convenient for customers.
Best Industries for In-Person Processing
- Retail stores – Clothing shops, grocery stores, electronics retailers
- Restaurants and cafes – POS systems help manage tables and orders
- Salons and spas – Easily process payments at the front desk or on mobile devices
- Auto repair shops – Customers pay on-site after services
2. Online (Card-Not-Present) Processing
How It Works
If your business sells products or services online, you need an online payment processing system. Customers enter their card details at checkout, and payments are processed through a payment gateway.
Benefits for SMBs
- Sell Beyond Los Angeles – Reach customers nationwide (or even worldwide) with an e-commerce store.
- Automated Invoicing – Many platforms allow you to send digital invoices and receive payments quickly.
- Integration With Shopping Carts – Seamless checkout experience for customers.
Best Industries for Online Processing
- E-commerce businesses – Clothing, electronics, handmade goods
- Professional services – Consultants, freelancers, marketing agencies
- Subscription-based businesses – Monthly box services, software companies
- Digital content providers – Online courses, downloadable products
3. Mobile Payment Processing
How It Works
For businesses on the move, mobile payment processing is a game-changer. You can accept payments anywhere using a mobile card reader connected to a smartphone or tablet.
Benefits for SMBs
- Great for On-the-Go Sales – Perfect for businesses that don’t operate from a fixed location.
- Low Setup Costs – Many mobile readers are inexpensive or free when you sign up.
- Accept Contactless Payments – Works with tap-to-pay and mobile wallets.
Best Industries for Mobile Processing
- Food trucks – Quick service, no cash handling required
- Pop-up shops and event vendors – Ideal for farmers’ markets and festivals
- Home services – Contractors, cleaners, landscapers can collect payments at job sites
- Fitness trainers and coaches – Accept payments after training sessions
4. Recurring Billing & Subscription Payments
How It Works
This type of payment processing is designed for businesses that charge customers on a recurring basis. Customers enter their card details once, and payments are automatically deducted based on a set schedule (weekly, monthly, annually).
Benefits for SMBs
- Steady Cash Flow – Predictable revenue helps with budgeting.
- Less Manual Work – Automates billing and reduces the need for follow-ups.
- Improves Customer Retention – Makes payments effortless for subscribers.
Best Industries for Recurring Billing
- Gyms and fitness studios – Monthly memberships
- Software as a Service (SaaS) companies – Subscription-based platforms
- Subscription box businesses – Monthly deliveries for beauty, food, or pet products
- Service memberships – Auto detailing, house cleaning, tutoring services
Which Payment Processing Method Is Best for You?
Choosing the right processing method depends on your business type and customer preferences. Here’s a quick guide:
| Business Type | Recommended Processing Method |
| Brick-and-mortar retail | In-person (card-present) processing |
| Restaurants & cafés | In-person + mobile processing for curbside orders |
| E-commerce stores | Online processing |
| Service providers | Mobile + recurring billing (if applicable) |
| Subscription businesses | Recurring billing |
| Event-based businesses | Mobile processing |
FAQs: Credit Card Processing for Small Businesses
What are four of the most common types of credit card processing for small businesses?
The four most common types of credit card processing for small businesses are 1) in-person (card-present) processing for retail and restaurants, 2) online (card-not-present) processing for e-commerce, 3) mobile payment processing for on-the-go businesses, and 4) recurring billing for subscriptions and memberships. Each method offers unique benefits depending on how and where you accept payments.
Which type of credit card processing is best for a retail store?
In-person (card-present) processing is best for retail stores, as it allows customers to pay using chip cards, contactless payments, or mobile wallets, reducing fraud risk and ensuring secure transactions.
What equipment do I need to accept credit card payments?
It depends on how you plan to accept payments. Retail businesses typically need a POS system or a card reader, while online businesses require a payment gateway. Mobile businesses can use smartphone card readers or mobile payment apps.
What businesses benefit most from mobile payment processing?
Mobile payment processing is ideal for food trucks, home service providers, trade show vendors, and any business that needs to accept payments on the go. It allows transactions via smartphones or tablets with mobile card readers.
Is recurring billing only for subscription-based businesses?
No, while subscription businesses use recurring billing frequently, other businesses like gyms, service providers, and SaaS companies also benefit by offering automated payment plans for memberships, retainer services, and installment-based billing.
How can I reduce credit card processing costs?
To lower costs, compare different payment processors, negotiate rates, avoid unnecessary fees, and encourage debit card payments (which often have lower fees than credit cards).
How long does it take to receive payments from credit card transactions?
Settlement times vary by processor, but most transactions take 1–3 business days to transfer funds to your account. Some providers offer same-day or next-day funding for an additional fee.
Conclusion: Credit Card Processing for SMBs
Accepting credit card payments in the most convenient way for your customers can improve sales, reduce checkout friction, and even lower your fraud risks. Whether you’re a Los Angeles retailer, a mobile vendor, or an online seller, there’s a credit card processing solution tailored for you.
If you’re looking to upgrade your payment system or explore new options, start by considering the needs of your business and the habits of your customers. A seamless, secure, and efficient payment experience can set you apart from the competition.
Need help finding the right payment processing solution for your SMB? Reach out to Dynamic Merchant Solutions today.
