As most London taxi drivers will know by now, a new Transport for London (TfL) mandate will make it a requirement for all black cabs to accept card and contactless payments from October 2016. Not all drivers are overjoyed by this regulation, but it’s not worth losing any sleep over. We take a look at how to become compliant with minimum costs and hassle.
To meet the requirements drivers need:
- A chip & PIN and contactless card terminal mounted in the passenger compartment
- A receipt printer mounted in the driver compartment
Drivers can no longer pass on the cost of accepting card payments to the customer, so good rates are now critical. There are plenty of payment providers to choose from, and with tighter margins good processing rates are worth shopping around for.
One of the first providers to launch a Black Cab specific bundle is iZettle. A popular mobile payment services provider across Europe, iZettle is used by taxi drivers in several countries, but has introduced a bundle specially designed to meet the requirements of the October 2016 mandate.
What distinguishes iZettle from a traditional mobile terminal using the GPRS phone network, is that iZettle uses app technology on a smartphone in conjunction with a card reader. The iZettle card reader relies on the processing power in the phone, thereby keeping costs of hardware down, if you already have a compatible smartphone (see list).
So what’s included in the iZettle Black Cab bundle?
The iZettle bundle comprises everything required in order for cab drivers to meet their new obligations.
- iZettle Pro Contactless Card Reader
- Star SM-L200 Bluetooth Receipt Printer (iOS only – see section on Any downsides below)
- Card reader mount
- Power converter and box of 20 receipt rolls
The bundle will set you back £299 + VAT (and is available here). It is good value compared to purchasing the items separately which would cost you £373 + VAT if purchased through iZettle.
To use the card reader, you need to have an account with iZettle. Normally it should not be a problem to get approved, but you might want to register online before you order the bundle.
What are iZettle’s transaction fees?
The mandate also specifies that tipping is cash only, and that the cost of a trip should be the same whether paid by cash or payment cards. This is not all good news for the hardworking drivers, who will find themselves unable to pass the cost of card payments onto their customers, and are also limited to charging for just the cost of the fare without being able to add anything extra for a tip if the customer chooses to pay by card.
So drivers should absolutely be concerning themselves with the day to day cost of processing transactions, which are in addition to the cost of the hardware and accessories bundle itself.
In a nutshell iZettle offers:
- No monthly fees
- No minimum term contracts
- A sliding scale of transaction fees, which start at *2.75%. If you process more than £2000 per month via iZettle you can expect your monthly transaction rate to start dropping, although their best rate of 1.00% is reserved for those businesses that have a monthly iZettle revenue in excess of £40,000. To calculate your rate based on your monthly card revenue, you can use this calculator.
- There are no fees for refunds
- There are also no additional charges for cards issued abroad, which is great news when you consider the number of tourists that visit London each year!
- There is no additional charge for American Express, Diners Club and JCB.
*unless you are on the ‘Pay as you go’ option to get the bundle for zero upfront cost; as mentioned above.
You get more than payments
iZettle technology has a number of other handy features that may be beneficial to cab drivers.
Although a receipt printer is mandatory under the new TFL mandate, iZettle also has the capability to send the receipt either by email or SMS which might appeal to some passengers and save plenty of paper!
With iZettle you get not just the card reader, but also a cloud based Point of Sale software. In the app it is possible to pre-programme types of trips and services. This handy feature lets drivers set up specific journeys at fixed costs. Think Gatwick or Heathrow trips, a sightseeing tour, peak/off-peak journeys and fares outside Central London. The iZettle dashboard can then analyse these trips by a number of different parameters including date, time of day, fare charged and more.
iZettle offers comprehensive data reporting on its online dashboard to help each driver make the most of their business – and ease accounting. All reports can be exported to Excel or CSV files.
iZettle could also work for you if you share a cab with another driver. Multiple drivers can use the same card reader and printer provided that they each install the app on their respective smartphone or tablet. If each driver has their own iZettle account then they can simply link that account to the hardware and start taking transactions.
Alternatively the cab owner can register an account and then set up separate log-ins for other drivers to use. This makes it simple to track which driver has taken which transactions and the cab owner can then pay out accordingly. Higher transaction volume on the same account also means lower processing rates.
iZettle uses the processing power of your smartphone, so do make sure that your current iPhone or Android phone is compatible (check here). Beware though – the printer included in the cab bundle has one notable limitation: it only works with iPhone.
If you use Android, you can still consider using iZettle, but you will have to get the card reader and printer separately. Star Micronics carries three other portable Bluetooth printers that are compatible with iZettle’s contactless reader (see: Portable iZettle printers).
While a traditional card terminal uses the GPRS mobile network, iZettle needs 3G or above to operate smoothly. This should not be a problem in Greater London, though drivers want to make sure they have a mobile provider with fairly consistent 3G or 4G signals.
An attractive solution?
iZettle have certainly taken advantage of the TFL mandate by providing a complete solution – their Black Cab Bundle – at an attractive price. With simple set up and competitive transaction charges, we fully expect iZettle to continue to be a popular choice for contactless transactions in London’s famous black cabs as we head into the latter part of 2016.