Phone Payments

How to accept card payments over the phone

Being able to accept card payments over the phone is a convenient way for your business to make sales, take deposits and collect outstanding balances. Whether you’re in retail, the public sector or a service-based industry, this useful payment option allows you to receive funds quickly and securely while ensuring a great customer experience.

In this guide, we’ll explain how to accept payments over the phone, as well as exploring additional options like automated telephone payments to offer even greater convenience for your business and customers.

7 min

Written by Access PaySuite.

What are phone payments?

Phone payments are transactions where a customer provides their card details over the phone, allowing a business to process the payment remotely. They’re often taken by organisations in sectors like healthcare, legal services and local government, where the customer may not always be present in person but invoices, deposits or service fees need to be paid quickly and securely.

Taking card payments over the phone offers a fast and convenient way to collect funds without relying on physical card machines. As long as you have the right set-up, you can take payments over the phone without the customer or their card being present. This method is known as a cardholder-not-present (CNP) transaction. CNP transactions are ideal for situations where the customer can’t travel to a physical location, for businesses that provide services on the move, or when a deposit is required to confirm a booking.

There are several different solutions that allow you to accept payments over the phone, including fully automated systems that are available 24/7 without human interaction from your team, staff-assisted solutions that offer a more personalised experience for customers, and semi-automated options offering the best of both worlds.

How to take payments over the phone

While the exact steps will vary depending on your system, taking card payments over the phone using a payment service provider is very quick and easy. However, it’s important to make sure that your process is compliant with PCI DSS (Payment Card Industry Data Security Standard), and that staff are fully trained on relevant payment processing and data security legislation, as well as how to spot the signs of a fraudulent transaction.

Generally speaking, when you take payments over the phone, the process follows three key steps.

1. Enter customer payment information into the virtual terminal

A virtual terminal, which is an online version of a physical credit card terminal or point-of-sale (POS) system, will be provided by your payment service provider. This software enables you to input and process a customer’s payment information even when their card is not physically present. This allows you to manually enter credit card information, facilitating seamless payment processing over the phone.

Automated telephone payments work in a slightly different way and involve the use of an interactive voice response (IVR) system, where the customer is guided through the transaction process by pre-recorded prompts and enters the payment details using their phone’s keypad. These automated systems are available 24/7 without the need for manual staffing, offering a convenient way for customers to make card payments over the phone at a time that suits them.

2. Verify the cardholder’s details

Once the cardholder’s payment information has been entered into the virtual terminal, you need to verify their details. This is done automatically through your payment processor, which contacts the cardholder’s bank to request approval and runs the transaction through fraud detection tools.

This process takes just a few seconds but is a crucial step when you accept card payments over the phone. By running a series of real-time authorisation checks, this step allows businesses to confirm that the card details are valid, that sufficient funds are available, and that the payment hasn’t been flagged for suspicious activity.

3. Process the payment

Following verification, the payment can be processed through the virtual terminal. Again, the payment processor communicates directly with the cardholder’s bank to process the transaction. This involves taking the necessary funds from the cardholder’s bank and transferring it to your merchant account.

After processing, you’ll need to provide the customer with a receipt. Most payment processors allow you to do this digitally via email. If needed, you can also print a paper copy to send to the customer in the post. Either way, it’s important to keep a copy of the receipt for your own records for accounting purposes or in the event of a payment dispute.

Setting up phone payment capabilities

If you’re ready to start taking card payments over the phone, here are the steps you’ll need to follow to get set up.

1. Choose a payment processor

The first step is to choose the right payment processor. Along with the different services offered by each provider, make sure to consider the unique needs of your business, such as integration capabilities, the capacity to scale and grow with your business, and the level and type of customer service included. The processes and associated fees to accept payments over the phone may also vary, so some options may be more expensive than they first appear.

2. Set up your merchant account

Once you’ve chosen your provider, you’ll need to set up your internet merchant account with them. This entails supplying them with information about your business, such as your banking details and billing address. Once your account is established, you’ll gain access to your payment portal, where you can view, manage and process payments. If you don’t already have a merchant account, you may be required to create one with the payment service provider.

3. Integrate your new system

The next step is to integrate your virtual terminal with your existing accounting, invoicing and payment systems. Some payment providers are able to take care of this for you, occasionally for an additional cost, while organisations with in-house tech teams may choose to handle this themselves.

4. Train employees and test the system

Before putting your new payment system live, it’s important to give your staff the necessary training on security protocols like never writing down customer information, data protection regulations like GDPR, and payment standards such as PCI DSS. This will help to insure compliance and minimise the risk of data breaches. You also need to process a few test transactions to check for any bugs or issues, giving you or your payment provider time to rectify them to prevent problems further down the line.

Secure and automated telephone payments

For businesses that want to accept payments without requiring a member of staff to manually process them, automated telephone payments offer a secure and efficient solution. These systems typically use interactive voice response (IVR) technology to guide customers through the payment process over the phone. By entering their card details using their phone’s keypad, customers can complete transactions securely without ever speaking to a member of staff.

This approach provides several key advantages. Most notably, automated telephone payments allow customers to make payments 24/7, without being limited by business hours or staff availability. They also help to reduce the workload for call centre teams, freeing up employees for more complex or urgent enquiries that require a personal connection.

Because customer data is input directly into the system and not handled by employees, secure phone payments via IVR also help to reduce the risk of fraud and improve PCI DSS compliance. For organisations processing a high volume of inbound payments, this type of system can significantly improve both efficiency and customer satisfaction.

Accept card payments over the phone securely with Access PaySuite

FAQs: Accepting card payments over the phone

Of course, taking payments over the phone is about more than just entering details into a system. Here are some of the key considerations to ensure that your phone payments are as secure as possible.

Is it legal to take card payments over the phone?

Yes. It’s legal to accept card payments over the phone in the UK, as long as your business complies with relevant data protection laws and PCI DSS standards. These regulations are designed to ensure that you take payments over the phone securely and protect customer data throughout the entire transaction process.

What regulations are there for taking card payments over the phone?

Payments made over the phone are considered cardholder-not-present (CNP) transactions. Specific standards and regulations are in place to protect consumer rights in these types of transactions. Businesses that accept card payments over the phone are required to adhere to the Payment Card Industry Data Security Standard (PCI DSS) compliance regulations to prevent credit card fraud and ensure the security of cardholder data.

Is it safe to take card payments over the phone?

It is safe to take payments over the phone if the proper security measures are in place. This includes using a secure phone line and encrypted payment processing systems. Personal and card data taken over the phone shouldn’t be written down or stored after the transaction has been completed.

What are the security risks of phone payments?

Taking card payments over the phone can carry risks if not managed properly. The most common concerns include unauthorised access to sensitive cardholder data, fraud, and data breaches. These risks can be reduced by using a secure virtual terminal, avoiding written or recorded storage of card details, and training staff on how to accept payments over the phone securely.

What is a virtual terminal?

A virtual terminal is a secure web-based interface that allows merchants to take payments over the phone. Staff enter the customer’s card details into the terminal manually to process the transaction. This is one of the simplest ways to accept payments over the phone without needing a physical card machine or in-person checkout.

Which businesses can take over the phone payments?

Almost any type of business can take card payments over the phone. However, as the customer doesn’t need to be present for the transaction, they’re most beneficial for organisations offering products and services from a remote location, such as takeaways, telehealth services, telemarketers or catalogue businesses. Phone payments are also useful for securing bookings and taking deposits for hotels, home repairs or professional services, and for public sector organisations looking to offer payment flexibility for all users.

What information do I need to take credit card payments over the phone?

To take payments over the phone, you’ll need the long card number, expiration date and CVV code. You’ll also need the billing address and the cardholder’s full name, both of which must match the registered card details. Finally, you’ll need to know the amount to be charged.

How can I provide a receipt for over the phone payments?

Most providers that support taking card payments over the phone allow for email receipts to be sent directly from the virtual terminal. If the customer’s email address isn’t stored, you’ll need to collect it during the call. If you or the customer prefer, you can send a physical copy of the receipt in the post.

Can you process refunds for transactions made over the phone?

Yes. As long as you follow your company’s refund policy and uphold the customer’s statutory rights, you can process refunds for payments made over the phone just as you would with any card-present transaction. Use your payment system or virtual terminal to issue the refund and confirm it via email or post, depending on the customer’s preference.

How much does it cost to take payments over the phone?

The cost of taking card payments over the phone depends on your payment processor and the specific terms of your agreement. These types of transactions are considered to be higher risk than in-person transactions, so are generally charged at a higher rate. The fees you pay per successful transaction are usually calculated as a percentage of the transaction amount plus an additional standard charge. Depending on your agreement, there may also be additional fees for chargebacks, refunds or international transactions.

Can I charge additional fees for taking credit card payments over the phone?

It depends on local regulations and your merchant agreement. You may be allowed to charge additional fees for taking card payments over the phone to cover your own costs under certain circumstances, but make sure to check with your payment processor for specific details before implementing this. You’ll also need to make customers aware of this additional charge before making the transaction.