NEWRingItUp_Body.jpgby Erin McDermott.


At the Laurie’s Chocolates stand at the Ottsville Farmers’ Market in Pennsylvania, an intoxicating scent emanates from the handcrafted blends, from the balsamic and Merlot truffles, to the steaming pot of hot cocoa.


Some other flavors now in the mix: MasterCard and Visa.


Standing behind the table loaded with her confections at the bustling weekend market, chocolatier Laurie Douglass is more than happy to take credit cards, and does so with her Android mobile phone connected to a small swipe device. Laurie’s Chocolates has been in business for 10 years and Douglass says the payment alternative has been a big boost at events, where sometimes she says she takes in almost half of her sales this way. Through just the first two months of 2012, Douglass said her smartphone-based sales reached half of her total mobile app sales for last year, which included her busy Christmas season.


Welcome to the new world of mobile payments. A flotilla of iPads, tablets, and smartphones are giving small businesses inexpensive new ways to tap customers’ plastic in an increasingly cash-less society. Last year, mobile commerce sales in the U.S. were expected to hit $5.3 billion, up 83 percent from 2010, according to Barclays Capital. Forrester Research projects that figure will climb to $31 billion by 2016.


RingItUp_PQ.jpgThe technology is becoming increasingly visible, from Girl Scout troops selling cookies to the political footmen fundraising in the field for the Obama and Romney presidential campaigns, to even polished ads on cable TV.


It’s also giving a much-needed boost to small businesses. And it’s not just tech-savvy entrepreneurs who are tapping in: A quick glance at the type of small business owners who are using mobile payment services shows plumbers, home inspectors, photographers, a hot-tub shop, dog-walkers, a few sandwich joints, and even a psychiatrist.


“I am seeing many service providers and solo business owners looking for payment solutions,” says Brandie Kajino, whose small-business tech consultancy is based in Vancouver, Washington. “Many of the clients I work with would like to accept payments via credit card, and these services offer a great alternative to traditional processors.”


Here’s how it works: After you choose your mobile payment provider, you download that company’s app or go to a provider’s website and register as either an individual or a business. Providers will ask for identification information, let you link to the bank account where payments should go, and set up your security measures. Once approved, you’re in business. Cards can be accepted immediately if you’re willing to punch in the numbers manually, but often an additional fee will apply if you do. Most providers will ship you their small swipe devices for free, but some are also available for purchase at electronics retailers.. The swiper plugs into the output jack of a smartphone or tablet.


From the customer’s perspective, the process is straightforward: They swipe their card and sign their name on a touch screen. They can opt to get a receipt either via email or text message.


For merchants, fees vary, but they are generally lower than traditional point-of-sale outlets. They typically run less than 3 percent on all swiped transactions, and have a higher rate (and additional, flat fees at anywhere from 15 cents to 25 cents per transaction) for manually keyed in purchases.


Most mobile payment services transfer funds to your account as soon as the next day, and many boast a free card reader and no startup fees or contracts. It’s a far cry from the cost of installing and leasing the traditional hardware necessary to accept credit cards, which can run as high as $4,000 to $5,000 for a startup. And that doesn’t include interchange and transmission fees that routinely total higher than 2.5 percent of each transaction.


Some limits: You’ll need a mobile device that runs newer versions of Apple iOS or Google Android as its operating system—most of these systems can’t be used with a PC or laptop. (A few mobile payment systems also work with some BlackBerry models.) And at some point the mobile app percentage rates may stop being a deal depending on your business’s monthly volume and average purchase price. For example, a business processing 200 monthly transactions at an average $50 a purchase might save money by using the standard credit card merchant system.


How to get started? Some advice from tech consultant Brandie Kajino:


- Look into the fees, and be sure you know what you're getting.


- Go with a reputable vendor.


- Get referrals from other business owners you trust, or an expert who keeps abreast of these technology solutions.