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bangtidypromo bangtidypromo is offline
Join Date: Oct 2005
Posts: 7
Payment Over The Phone

Hi, im currently working on setting up an online store and just wondered about taking orders over the phone. I won't have a business bank account for the time being and will be taking payment via Paypal. What i want to know is, would it be legal for me to take and order over the phone and process it though on the website and input the customers details on Paypal to process the payment?

Im guessing its not legal as I don't think anyones doing it but if I wasn't holding the details myself and I informed the customer it would show as a Paypal payment on their statements I can't see the problem?

Thanks in advance
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lordlancaster's Avatar lordlancaster lordlancaster is offline
Join Date: Jan 2009
Location: Gateshead
Posts: 1,336

Not sure if it's legal or not to be honest, but it's more likely that people will be unwilling to give out their credit / debit card details over the phone. Also, if you're running an online store, then web-savvy shoppers will expect to be able to pay themselves without having to speak to you over the phone. If not, they won't thing much of your operation.

Even if you don't have a business bank account yet, what's wrong with you letting them pay money into your PayPal account and then withdrawing the money into your personal account? I thought this could be done?

I'm sure you've already seen it, but take a look at as there may be another way around this that you haven't thought of yet.
Paul Lancaster
Content & Social Media Specialist
Sage One UK
Follow me on Twitter @lordlancaster
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AlexanderSmith AlexanderSmith is offline
Join Date: Jan 2009
Location: Milton Keynes
Posts: 267
with paypal, well any payment don't forget the costs involved. The company I used to work for was a franchise and was not allowed to process payments online (due to contractual restrictions). We needed people to be able to pay by phone though.

We set up the card payment over the phone just as I was leaving. I was very skeptical. We had to put a £1.50 handling charge on to cover all costs.

As we were service based we had to put th price of our premium products up too, to cover the costs because paypal also take their 3.25% or whatever amount it is now.

Meant adding around £5 to most of our premium products, plus they then had the £1.50 handling charg.

We took card details, but be careful and think about data protection. Remember if you loose the details or they get stolen, you become responsible for any losses the cards inccur.

Alexander Smith
Fizz Pop Science

Fizz Pop Science is working to become the UKs leading extra curricular science education provider. We want to engage children with the sciences and have them experimenting themselves, leading to new discoveries which we hope will inspire.

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jennytwin jennytwin is offline
Starting Out
Join Date: Mar 2009
Posts: 14
The company I used to work for had a very dubious system for processing credit card payments over the phone. They are a government funded company so apparently it was legal I have my doubts). The call takers in the call centre used to actually write the customers card details down on a form and then take it over to my team who had access to the business banking side of hsbc where we would input the details take payment and then shread the form.
To me this was very dodgy in terms of data protection and the customers were never informed that there details were being written down. Makes me wonder what happens at other companies when you give payment over the phone as this was a big national company!
Which is probably why people didnt question it, they may be more reluctant to do it with a new company.

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Spodaz Spodaz is offline
Join Date: May 2008
Posts: 58

Firstly why not get a business bank account it is going to make it so much easier for tax purposes and many banks will give you upto 2 years free banking

In regards to online payments you have a number of options available to you, the simplest form as you have already suggested is PayPal, a good thing with this is that people no longer have to be a member of PayPal to send you a payment, although their transaction charges are seen as quite high by some.

They do offer a Virtual Terminal Service which will allow you to take payments over the phone, there is an extra charge for this but full details can be found at

Another option you could look at is a company called NoChex, I used to use them in the past to process online payments and find them to be very good, also they used to have quite good chargeback protection, however, they do not offer over the phone payments.

You could also take a look into bigger systems such as WorldPay which offer complete solutions including Virtual Terminal although this will be more costly to set up.

Shell LiveWIRE Forum Admin
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turnkeyit turnkeyit is offline
Join Date: Feb 2007
Location: Nr. Weston Super Mare, Somerset
Posts: 165
Hey there,

You really shouldn't take peoples credit card details over the phone, and then go through the online process of entering their card details. I don't think its illegal, however it's not right.

The only way you should take payment over the phone, is by using a virtual terminal, similar to PayPal's Virtual Terminal service, or something like SagePay, where the service specifically allows you to take payments over the phone.

The main reason for this, as previously said is if the details get lost or stolen, you can be the one in trouble.

Your best bet, is to let people pay online, if they can't, then why not accept a cheque as a way of allowing offline payment?
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