In a retail store, restaurant and many other locations where you need to make a payment using a credit card or cash a point of sale (POS) system must be in place. An all-inclusive selection of processing solutions, payment gateways and in-house credit card payment system is available that will meet all your business requirements. Merchants can use them to process payment via card. They will receive instant response of the transaction status. The credit card pos will increase sales and reduce bounced checks from your customer. The credit card is processed very securely and efficiently. There are several kinds of terminals used – Hypercom, VeriFone, Nurit, Ingenico. The credit card is swiped through the terminal which gets processed, the credit card details are verified by the bank via the network. If the funds are available in the account then an authorisation code is sent to the merchant via the payment gateways and credit card processors. Money does not change hands when the authorisation code has been exchanged. The authorisation has the card verification response, merchant’s descriptor the name as it will appear on the credit card statement and the amount to be captured. The money is then sent to the merchant’s account via ACH wire transfer or directly.
The payment gateway offers security, fraud control, and reporting. The credit card information and transaction request is sent to the payment gateway (service that receives payment request then sends it to the payment processor). The processor identifies the Network based on the type of card. The network collects the card information and validates the credit card details, balance, and security check. If the card issuer (customer bank) approves the transaction and security check, the Network sends an affirmative response to the POS and completes the transaction. A funds transfer is requested by the Network from the purchaser’s account to the merchant’s account, if the credentials of the purchaser are valid. The transaction approval information is notified on the POS terminal. In case, the details are incorrect the funds will not be transferred (often called settlement) however the terminal receives information on the decline status.
The settlement is a three step process. First is the ‘Authorisation’ when the customer is approved for a purchase; second is ‘Capture’ the merchant passes a batch of authorised transactions to the Network (every night); third is the ‘Settlement’ when the captured transactions is pulled from the customer and moved to the merchant’s account. POS has integrated with the payment gateway, so the fees are based on a monthly fixed cost. Other charges include a per-transaction fee, and a transaction fees which is an overall percent. Generally the POS (or sometimes the payment gateway) charges one single fee to the merchant that covers all the downstream processing costs. The POS is ideal for certain businesses such as professional offices, hotels, restaurants, retail storefronts, and government agencies.
