Why taking deposits incorrectly might risk a huge fine
This blog post will help you make sure you take deposits correctly.
As a business owner are your team following the law?
Taking a deposit or upfront payment when a client books over the phone can be an effective way of stopping last minute cancellations and no-shows. More and more salons are now taking deposits to stop cancellations and earn more money to cover rising costs.
Taking payments over the phone, requires you to follow certain steps to protect clients personal and financial details. Failure to do so could lead to a fine under GDPR legislation of up to EUR 20 mil or 4% of annual turnover (whichever is higher).
Protecting your business from a £50 no-show is important but not at the risk of a £5000 fine. The experts at Slick look at how to take a deposit securely whilst complying with GDPR laws.
What is the risk?
Handling a clients credit /debits card details is a risky business. You wouldn’t want to hand your card details over to just anyone would you? You would want to know your confidential details are being treated securely and that there is no risk of fraudulent transactions.
The risk comes when card details are written down or stored on a device in a way that they can be accessed later.
So if your team are doing any of the following then this is a red flag:
Writing card details down on paper to process later
Storing client card details on any non GDPR compliant device
Storing card details in the client notes
Client card details should never be stored anywhere that is not GDPR compliant.
How would you feel if you knew a shop down the road had your credit card written down? It doesn’t matter if it is destroyed immediately - it is still a risk and that risk could turn into a large fine very quickly.
“But I’m a small business, I’ll never get fined…”
Maybe. Not every business gets a VAT inspection but is that a risk you are willing to take?
As credit / debit card fraud increases, more and more clients are concerned about who has access to their card details. All it takes is for just one client to complain and you could have an investigation on your hands.
How to process a deposit securely?
If you do take deposits without the customer present then you should follow these steps:
When asking the client for their card number, enter it straight into your POS / card machine. Do not write down any information.
Process the payment immediately.
Once the transaction has been completed you are required to provide the client with a receipt for the payment. You can ask the client to collect this from the salon or you can post this to them if necessary
How does Slick help me stay secure and within the law?
Slick allows you to take deposits quickly, securely, in a GDPR complaint manner, whether the client is present or not and without the risk of a £5000 fine.
Slick is partnered with Stripe, one of the world's leading payment companies which specialises in online payments to ensure that businesses and customers are safe and their details secure. Together, we have partnered to launch SlickPay: an easy and secure way to take deposits
Here’s how it works
Slick sends your client a secure and personalised message with a payment link so they can pay their deposit safely online.
They enter their card details and checkout just like they were buying something from Amazon.
They then receive a reception as proof they have paid their monies.
You receive payment without ever handling the card which means all the risk is carried by Slick and Stripe. Your customers card is kept on file for future use but you can not access the details (just the last 4-digits) so you are GDPR compliant.
The client pays easily and safely in the knowledge that their card is being handled securely without you or your team even seeing the card details which means you are not exposed to any GDPR risk.
As cancellations have risen across the industry, we are seeing more and more salons protecting themselves with deposits and the proof is in the pudding - their revenue has rocketed. So, if you’d like to find out more about how to setup Stripe deposits then please contact the Education team or click learn more.