Mobile Credit

In order to pay bills and stave off creditors, many small business owners have traditionally used a line of credit or taken out a new card for their business while waiting for invoices to get paid. Nearly half of small business owners surveyed by Bank of America last year said not getting paid on time was their biggest challenge. But for many, that may soon be a thing of the past.

More and more businesses are turning to an array of payment applications and technological devices that instantly convert sales into cash. They include Intuit GoPayments, PayPal Here, PaySimple, and Square Card Reader. The popularity of these new technologies is soaring as more and more small businesses embrace emerging mobile technology payment solutions.

PaySimple, a Denver-based company that entered the marketplace in 2006, now counts 10,000 small businesses as customers. The company saw a 50 percent increase in users last year. Others, like Flint Mobile Inc., take photos of credit cards with an iPhone and process the transaction. The Redwood, California startup reported that it attracted 40,000 users in just three months.

The technology is still evolving and new features continue to emerge, but nearly all of the payment systems have devices that attach to smartphones. Known as “dongles,” they enable business owners to swipe debit and credit cards.

Some of these applications and devices are free. Some charge a monthly fee for the account. Others charge by the transaction. For instance, while Flint’s app is free, the company charges users 20 cents per transaction. It also tacks on additional 1.95 percent for each debit card and 2.95 percent for credit cards swipe.

Many business owners say the fees are worth the cost of doing business and having better cash flow. The almost instant nature of payment could make invoices a thing of the past. Why send one and wait 30, 60, or 90 days for payment or have to hire a collection agency to help you get your funds when the invoice goes unpaid? These devices are affordable and available. Shop around to find the one that best fits the way you do business.

Rosemarie Clancy is editor-in-chief of She writes frequently on credit-related topics for consumers and business owners.