How Do Credit Card Processing Machines Work?

Credit card processing machines come in many shapes, forms, sizes and prices. The machine you purchase for your shop should be based on the amount of business you receive from cardholders, as well as your budget and space. These machines are a must have for any merchant who wants to increase their revenue through catering to clients who prefer to pay with credit cards.

Card Terminals

Most modern stores now use machines to process credit card transactions. One of the most common machines used for this purpose are called credit card terminals. These are best for merchants who handle a large volume of payments. Customers will swipe their card in the machine and then enter their data via keypad, after which the payment will be processed. Once the credit card is accepted, many terminals will print a receipt.

A single card terminal can be purchased for as little as two hundred dollars, usually from the bank which provides the merchant account. However, this can add up quickly if your store has multiple checkout counters. Additionally, some card terminals are powered by battery, which is an additional cost that must be considered. Card terminals must also be physically connected to a telephone network, so that real time transactions can be processed. More advanced models allow you to store data regarding transactions, and because this data is stored internally, it is secure.

Mobile Phone Devices

Because a growing number of people are using their smart phones to shop, devices have been introduced which allow customers to pay with their credit cards through their mobile phones. These transactions will be processed through wireless connections such as 3G or 4G. When using these devices, customers will either enter their credit card numbers manually, or they will use special hardware add-ons to swipe their cards.

The primary advantage that mobile devices have over card terminals is portability. Transactions can be carried out in any location where the phone has reception, and in some cases it can eliminate the need to wait in long lines in order to pay for products or services.

The biggest downside to mobile payment devices is security. If the customer uses applications that are not encrypted, this can compromise their data. Making payments by smart phone is a newer technology, and as such, many stores have not yet adapted it, and some people used to cash registers and card terminals may be unaccustomed to using them.