The United States is rapidly becoming a cashless society with less than 30% of sales transactions involving cash. Your Scout unit can leverage smartphones and free card readers to accept credit and debit card payments.
Portable Card Readers Enable Cashless Fundraising
For years, the only way to accept credit or debit card payments required a rented credit card machine with a contractual commitment and hefty transaction fees. Recently, new transaction processing services have become available that avoid the expense and commitment of commercial transaction readers by leveraging the ubiquitous smartphones that many people carry.
These new services require no setup fees or commitment and allow almost anyone to accept credit or debit cards for a nominal percentage of the transaction. These services also allow you to manage cash and check payments. All of these services provide a free card reader that plugs into the headphone jack on your smartphone and apps for IOS or Android.
Several companies provide these services:
- Square was the first of these services. Square charges 2.75% of each transaction.
- Paypal Here charges 2.7% of each transaction and also allows you to accept Mobile PayPal
- Intuit GoPayment charges 2.75% per transaction but also has subscription plans that allow you to pay a monthly fee of $12.95 to get a lower rate of 1.75% per transaction. It also integrates with Intuit QuickBooks.
This is only a partial list. There are a number of other vendors jumping into this area so you might want to look around for the best deal. Payment plans and rates are subject to change, so be sure and check the vendor web site for the latest rates and plans.
Do not let the transaction percentage scare you off. Using any of these services is going to cost you a small percent of the sales, but the point of using these services is to make sales that you would otherwise lose.
For example, one of my Troop’s major fundraising events is Christmas tree sales. Traditionally we only accepted cash or checks, but started using Square on an exception basis in 2012. That first year, about one third of our sales were made using Square—sales that we might have lost if we could not accept credit cards. In 2013, about 70% of our sales were through Square and by 2014 over 90% of our sales were through Square.
How Do Cashless Transactions work?
Since my Scout Troop uses Square, my experience is with that particular service. I would expect that using one of the other providers would be similar.
- During a transaction, the seller would plug the Square Reader into the smartphone headphone plug and start up the Square Point of Sale app.
- You enter the transaction amount and then swipe the customer’s credit card using the reader.
- The customer then signs the screen using their finger.
- If the customer wants a receipt, you can have them enter their email address. In about 24 hours, the money, minus the transaction fee, is deposited to your bank account.
Getting Started with Square
I originally used Square because they were the only one available, but I will say that I have been very satisfied with the service with Square. I rewrote the section on adding additional people to the Square account in December 2015 due to changes at Square.
The support I received from Square via a phone call was excellent. The Support person, Kemeta, actively helped me to achieve my objective (allow additional Troop members to make sales) at no additional charge. Thanks!
There are only a few setup steps needed to accept payments via Square but it does take a few business days to get everything done. Do not wait until the last minute!
What you will need:
- An email address (for Square transactions and notices).
- I used an account with automatic forwarding so that all Square emails are sent to me and to our unit finance chair. By default, Square will send an email for each transaction.
- A check for the Scout unit checking account for bank routing and account number information
- I strongly recommend that you do not use your personal checking account
- A smartphone (iPhone, Android or iPad) with a data plan
- See Square’s web site for supported devices
- Time to receive the Square reader in the mail and to validate the bank account
- It took about four business days for the bank account to get validated and for deposits to start showing up
- Square says that it should take about 7-10 days to receive the free Square reader from them. You can also purchase a Square reader from Target and other stores for $10 if you cannot wait.
Setting Up Your Square Account
- Got to https://squareup.com/ and click on “Get Started”
- Enter the email information and choose a non-trivial password
- Press “Create Account”
- Enter the address where you want your free Square Card Reader to ship to. Click “Continue”
- Select your business type from the drop-down list. Enter your business and personal information. I choose the name “BSA Troop 413 Austin” because that is what will show up on the receipt. I also uploaded a logo with the Troop information on it. Click “Continue.”
- You will answer a few questions to verify your identity. When completed, click “Finish.”
- Now you will link your bank account to your Square account. Click “Add Account”
Square will make a series of small deposits and matched withdrawals to validate that the new account is valid. This may take several business days.
- Confirm your mailing address to ensure your Square card reader arrives at the correct location. Click “Send my Reader.”
- After you have completed the basic registration, You can add a list of items to make it easy to perform the transactions. Click on “Items” at the top of the Square profile to add common transaction items.
For example, I set up a number of “Christmas Tree” items at several common price points.
Now you want to give members of your unit the ability to make sales. This used to be done with “Employees” but now you should use “Guest Register” instead. “Employees” is now a charged feature in Square but “Guest Register” is still free and meets the requirements for a Scout unit.
- Click on the “Employee” link in the left navigation and then click on the “Permission Groups” button on the right.
We are doing this to limit the capabilities of the Guest Register users.
- Edit the “Guest Register Access” and select the capabilities you want your sellers to have. Then click “Save Settings”
Now we will create Device Codes for individuals that are going to be using Square for sales
- Go back to the “Employee” menu and select the Owner account. On the right side push the “Assign New Passcode” button.
You will receive a four digit Passcode. Write down this number. You will need it later when a new person/device signs in
Now let’s create some device codes that will be used by the members of your until to login to Square Point of Sale app and start processing transactions.
- Go back to the Square Dashboard and select “Accounts & Settings” then “Devices”
- Enter the Device Name. I use the name of the person that owns the device.
- Then select the location from the pull down (you should only have one location. Press “Save New Device
You will receive a popup with the Device name and 12 alphameric digit device code.
Copy and paste this device code into an email mail of the person that will be using the device.
Now let’s get the new device active.
Have the person start up the Square Point of Sale app (they should have previously installed the app)
- Launch the “Point of Sale” app and click “Sign In”
- Click on the “Use a Device Code” in the upper right hand
- Now enter the 12 digit alphameric code you created for the device and click “Sign In with Device Code”
- Finally, you will need to enter the four digit Passcode created earlier in Step 12.
Using the Device Code function to register several people to a single Square account has several benefits:
- It allows each Scout/Scouter to sign into Square with their own device
- All funds go directly to the same account
I usually order several Square readers over the year so that we have several on hand for our big sales. Since almost everyone now has a smartphone that can run the Square application, it is easy for each person to individually collect each sale.
Square provides the capability to process refunds. As an extra security measure, I set up the account to require a PIN to process refunds.
- Click on “Employees” to set the PIN and select which tasks require a PIN.
Make sure you have installed the most recent version of the Square Point of Sale app (don’t try to use last year’s version)
- Make sure the Square reader is powered (it should be plugged into the charger at all times)
- Remove the Square Contactless Reader from the Base (required for Step 6)
- Go into your phone and turn Bluetooth (for Iphone “Settings” -> “Bluetooth” move slider to the right)
- Open the Square Register application
- Tap Settings > Card Readers > “Connect a Reader.” On an iOS device, tap “Contactless + Chip Reader.”
- Push the button on the Square Contactless Reader for 3-10 seconds
- Remove your finger as soon as you see orange flashing lights. You should see green flashing lights If you see red flashing lights, you’ve held the button too long and you’ll need to try again.
- The Reader will be listed as “Ready” in the app
- Put the Square Contactless Reader back in the base
A special note about tax reporting.
Square automatically file a IRS form 1099-K for all businesses that have more than $20,000 in gross sales and more than 200 transactions in a calendar year. Non-profit organizations are included. If you anticipate anticipate total sales of this level, you should insure that your Square account includes your Employer Identification Number (EIN).
- To enter your Tax EIN and other related info, go to https://squareup.com/taxupdate
- Download the “Square Point of Sale” App for your phone.
Now all you have to do is wait for your free Square reader to arrive in the mail.
- Plug the Square Reader into your headphone jack on your smartphone and start the “Point of Sale” app.
- Log into the app using the email address and password you used for your Square account in Step 2 above.
- You can now enter an amount for the transaction and a note.
If you set up Items in Step 9 above, you can press the center icon on the screen to bring up the Item list (right, below). If you have multiple price points for an item a secondary list will be shown (left)
- Click on an item to select it (or just enter the amount if you are not using pre-built Items)
In this example, I clicked on the “$100 Christmas Tree” item.
Note that the number of items is “1” and that the total is “$100”. The list of items stays up so you could add more items.
- Click on the “Charge $100” on the screen.
- The Point of Sale app will now give a choice of how to pay. Click on the Credit Card icon
- You should now be able to swipe credit or debit cards using the Square Reader.
- Then the client signs with their finger.
- If the customer wants a receipt to be mailed or texted to them, you can do that next.
If not, you are done!
More than Just For Popcorn and Christmas Trees
These transaction-processing services have obvious uses during fundraising activities, but the fact that you can take payment from a credit card can also help parents pay for expensive items like Summer Camp or High Adventure trips. Instead of parents making multiple payments to the unit for these trips, the unit could swipe their credit card for the total amount; simplifying unit bookkeeping.
You could also considering using these services as a way to collect for Friends of Scouting by collecting contributions during the FOS presentation and later cutting a check for the total amount to the Council.
Square and similar services allow Scout units to take advantage of the consumer trend away from cash payments. Not only is it more convenient for customers, but it also shows that Scouts are able to leverage the most recent technology.
Jay Kruemcke firstname.lastname@example.org
BSA Troop 413 / Armadillo District / Capitol Area Council
Updated December 2017 (originally published April 2014)