Chase Paymentech now offers a mobile checkout application and card reader as part of its Chase Checkout point of sale technology for small businesses.
Chase Mobile Checkout allows merchants to accept card payments through an encrypted card reader attached to their iPhones or Android devices, Chase Paymentech announced Aug. 13. Dallas-based Chase Paymentech is the merchant acquirer and payment processor unit of JPMorgan Chase, and serves as the processor for Square.
Chase joins Bank of America and other acquiring banks in offering mobile card acceptance for small merchants. "We are not the first to market with this, but we are trying to be the best to market," says Chase spokesman Edward Kozmor.
"We are building on our reputation for security and service," he says.
Like similar card readers, Chase Mobile Checkout "provides card-present payments for small businesses like beauty salons or lawn services," Kozmor says. Bank of America unveiled its Mobile Pay on Demand reader late last year, and Fiserv's SpotPay reader is sold almost exclusively through financial institutions.
Chase Mobile Checkout is designed to work with the Chase Paymentech's other offerings, such as its iTerminal software for retail checkout. Merchants can choose any of the Chase Checkout products they need, though some will find the new mobile app as the "stand alone" product that fits their business model, Kozmor says.
Most banks feel they need a mobile card reader to compete, says merchant acquirer consultant and industry researcher Paul Martaus, of Mountain Home, Ark.-based Martaus & Associates.
Adding this product makes sense for Chase Paymentech because of its simplicity, Martaus says. "The reader on the smartphone is all some merchants need," he says.
By offering its own card reader, Chase locks down a significant portion of mobile payments because it also processes debit and credit transactions for Square, Martaus says.
Chase did not disclose which company manufactures its reader. Chase Paymentech has worked with card reader manufacturer Roam Data in the past.
After merchants activate a Chase Mobile Checkout account, Chase Paymentech ships the card reader and provides instructions on how to obtain the companion app.
The Chase Mobile Checkout card reader, which fits in the audio port of the Apple and Android smartphones, accepts credit cards, signature debit cards and gift cards.
The reader accepts only mag-stripe cards, but merchants can manually enter an EMV-chip card if there is an account number embossed on the plastic.
Chase's reader includes a rechargeable lithium ion battery so it does not need to rely on the phone as a power supply. The battery also helps improve the accuracy of the reader, Chase says. Data encryption is performed on the device, so personal information is never stored on the mobile phone, it says.
Merchants also will be able to monitor and process voids and returns from their smartphones, view sales and transaction summaries from the app after the payments have been processed, Chase says.
In addition, merchants can create a catalog of item descriptions and images, and they can send receipts by email and text message. The receipt contains a copy of the shopper's signature and the location of the sale.