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To accept non-cash payments from bank cards and contactless payment devices, entrepreneurs connect POS terminals. But not everyone understands the types of terminals, understands their difference from a POS system and dependence on an online cash register. To choose the right device and work safely with it, read our review.

What is a bank POS terminal

  • How the POS terminal works

  • How a POS terminal works

  • What else can the terminal do

How the POS terminal differs from the POS system

What types of POS terminals are on the market

How to buy or rent a POS terminal

  • Select terminal type

  • Select acquiring bank

  • Buy or rent a POS terminal

How to ensure safety when working with a POS terminal

What is a bank POS terminal

A POS terminal (from the English Point Of Sale – point of sale) is an electronic device for accepting payments from bank cards. It accepts magnetic stripe cards, chip cards and contactless cards. Works with smartphones, smartwatches and bracelets that are configured for contactless payments. This is a familiar thing to you: you yourself paid many times through such a device in stores and saw a photo of a POS terminal in an advertisement for online cash registers.

To work with the device, the bank activates the acquiring service. The bank accumulates the amounts received from the buyers cards, and regularly transfers them to the merchant s current account, and leaves a commission for services to itself.

How the POS terminal works

The standard equipment includes the following elements:

  • display;

  • card reader;

  • keyboard for setting up the terminal, entering the amount and pin-code;

  • computer unit with a processor and random access memory;

  • GPRS modem or port for connecting to a router, cash register for exchange with other devices;

  • mini-printer for printing receipts;

  • battery or power supply.

The design may differ depending on the model and purpose of the device. For example, integrated terminals that work only in conjunction with the cash register do not have a printer for printing receipts – they are printed by the cash register. Some terminals can be connected to a separate mini-keyboard for entering pin codes.

How a POS terminal works

The terminal accepts payment from bank cards and transfers the money to the merchant s account.

  1. The buyer informs the cashier about the non-cash payment, the cashier switches the terminal to the payment mode and enters the purchase amount.

  2. The buyer applies the card to the device, inserts it or swipes it with a magnetic stripe, enters the pin code.

  3. The terminal sends information to the processing center of the acquiring bank.

  4. The bank checks if there is enough money on the buyer s card and if the card is on the stop list.

  5. If everything is in order, the bank debits the amount from the card.

  6. The terminal prints two receipts: one for the cashier, the other for the customer – or sends an electronic receipt to the customer s e-mail. If it is an integrated terminal that is connected to an online checkout, the checkout is printed by the checkout.

Through the POS terminal, non-cash payment is possible using a smartphone, smart watch or ring. The customer s device must have an Apple Pay, Google Pay, or Samsung Pay app. In addition, both devices – a smartphone and a terminal – must have an NFC module for contactless payments. The smartphone is brought to the terminal, the data is transferred to the banking system, and the payment is made.

After payment, the buyer s money is not immediately transferred to the seller s account, but is temporarily blocked on the account. The law requires this for the security of payments.

What else can the terminal do

Pos terminal allows you to cancel a payment or make a refund. Its memory stores all the information about the completed operations: you can quickly calculate profits and create reports on the results of sales.

Each employee who works with a POS terminal is given an identifier. This helps to control the work of the staff.

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How the POS terminal differs from the POS system

The term “POS terminal” has three meanings:

  • in a narrow sense, it is a device for accepting payments from cards;

  • in a broader sense, it is a complex of apparatus and software for accepting non-cash payments;

  • sometimes users confuse concepts and call a POS terminal a cashier s workplace – a POS system.

A POS system can consist of many elements: a monitor, a system unit, a customer display, a card reader or POS terminal, a barcode scanner, a mini-printer, a fiscal drive, a cash drawer, etc.

A POS terminal is a small device to which we attach a card or smartphone for payment. It can be autonomous: with a receipt printer and Internet access, this can be seen at the courier who brought you pizza. Sometimes he replaces the online cashier, if he transfers data on purchases to the tax office, prints receipts with fiscalization and stores them in memory.

Also, the terminal and the system differ in the place of installation of the memory module for operations. The system has it installed in the fiscal registrar, which automatically transfers the data to the tax office. At the terminal – in the case of the computer unit; and in order for the terminal to transmit information to the Federal Tax Service, specific cash programs are needed, which are listed in the State Register of cash registers.

Its functions largely depend on the features of the program installed on the terminal. The capabilities of a convenience store or restaurant may differ, not to mention a retail terminal. Take time to choose software, get advice from the terminal supplier.

What types of POS terminals are on the market

Integrated machines work in conjunction with the cash register equipment, they are needed only for reading cards and entering a pin code, the receipt is printed by the cash register printer. They will be connected to the cash register via USB, COM or Ethernet connector. Suitable for shops with a stationary payment point. There are more models of such terminals than stand-alone ones.

Autonomous POS-terminals are independent devices, they are not connected with the cash register and work separately from it, sometimes they replace the cash register. Such a terminal has a card reader, keyboard, mini-printer, Internet access for communication with the bank, cash program for transferring data to the tax office. Autonomous terminals are:

  • portable with a built-in battery: they can be used in cafes, taxis, for courier delivery of goods; data is transmitted via GPRS, Wi-Fi or Bluetooth;

  • stationary with connection to the power network: they are good for stores where customers themselves come to the place of payment; data is transferred via USB-port, GPRS-channel, Dial-Up.

Mobile mPOS terminals are miniature card readers that connect to a smartphone via an application. Couriers and taxi drivers also have such terminals.

How to buy or rent a POS terminal

Select terminal type

Terminal + cash desk. If the terminal will work as part of a cash register, a simple model without a receipt printer and Internet access, with connectors for connecting to the cash register, will do. For the convenience of the cashier and the customer, an external keyboard is connected to the terminal for entering pin codes.

Stationary terminal in the store. A model with a power supply connection, a fiscal drive and transfer of information to the tax office, a receipt printer and access to the network is suitable. Connecting to the Internet via a network cable will give a high speed of data transfer, for this, the store must have a wired Internet, and the pos-terminal must have a connector for a patch cord. Many terminals work via Wi-Fi or a sim card to connect to a mobile network: for this, you will have to ensure the stable operation of the router in the trading floor or monitor the balance of the sim card.

When choosing a stationary terminal for the store, which will work in conjunction with the cash desk, pay attention to the number of ports. They should be enough to connect a cash register, pin-pad, wired Internet. The monitor and keyboard must have a great resource of work.

Portable terminal. The device for the field trade must have a battery, a fiscal drive and an Internet connection. A receipt printer is not needed if the terminal sends electronic receipts to the customer s e-mail. A terminal with a Wi-Fi connection will look for a wireless network at the place of payment, while a device with a SIM card and mobile Internet will depend on the mobile operator and the card balance.

mPOS terminal or card reader. When you buy a card reader that attaches to your smartphone, you should already have an online checkout. The mPOS terminal will transmit information about purchases to it.

Select acquiring bank

The choice of model depends on the equipment of the acquiring bank: you cannot connect any terminal to its payment gateways. Therefore, select a servicing bank based on its acquiring tariffs, commission, reviews and other conditions, then find out which terminal models the bank works with.

Buy or rent a POS terminal

Compare prices for your model and service offerings from the acquiring bank and privately licensed companies.

  • Acquiring banks offer to buy or rent devices with which they work. Renting will cost more, but it is profitable if the entrepreneur has a small budget and does not want to pay the full amount from 8,000 to 25,000 rubles per terminal.

  • Private companies offer new and used devices, and also put terminals for service. The tax office allows this, but make sure that the device complies with law 54-FZ and is listed in the State Register of Cash Register.

How to ensure safety when working with a POS terminal

When working with the terminal, there is a risk of “catching a virus” that transfers payment card data to cybercriminals. Use only the recommended licensed software and update it on time, revise the equipment.

In the acquiring system, in case of fraud with a bank card, if the cardholder suffers a loss, the seller reimburses it. And the seller will be reimbursed for damage only if the police catch the fraudster, which does not happen often. Therefore, follow the recommendations for ensuring security from the bank and the terminal supplier.

POS terminals are considered quite safe devices: they connect directly to the bank s processing center, and it is almost impossible to intercept data. Mobile mPOS terminals are less protected: due to the use of a smartphone, card details can be intercepted. Therefore, banks often set a limit on the amount that a customer can deposit through a mobile terminal.

Post Author: Rachel Reinbauer

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