Since the invention of credit cards, the use of cash has plummeted and has fallen further with the launch of debit cards, gift cards, prepaid cards, and other payment methods, such as PayPal or Neteller. However – and despite new technologies – it is still essential to have a credit card machine in any business, since most payments are made with plastic.
But is buying a credit card device that simple? The ease of acquiring a terminal like this will depend on the country where you are, but -in most cases- it is.
What is the name of the device to pass the cards?
Machines for credit cards have many names, but the most common are the data – phone, the pasatarjetas device, the PoS and POS or POS terminal . These last two meanings should not be confused with the PoS or POS system, which is computer software that combines the use of hardware -such as a barcode reader and a dataphone- to facilitate collections and the issuance of invoices.
So what is a credit card machine?
It is a device or hardware that connects to a phone line to process payments. The terminal is equipped with a magnetic stripe and chip reader. Some of them require a connection to a local phone line in order to work, especially the older ones. Others are wireless and work with a telephone line similar to that of a mobile, that is, with a SIM card.
There are even accessories that can be connected to a smartphone and that work in the same way as a conventional credit card machine. There are many models, so you will have to choose which one is the best for your type of business.
How to buy or rent a machine to charge with a card?
The POS terminals are available in the market in two formats: those for rent, which are owned by a third party – commonly, a bank or financial institution – and those for free sale. Regardless of which one you acquire, you will always need to subscribe to a bank or payment wallet so that the funds reach the company’s checking account.
You can also get credit card machine loans according to your business needs.
Option 1 – Rent a PoS at the bank
This is the preferred option for businesses worldwide because it is as easy as contacting the banking institution and ordering a complete POS package. Most banks require the signing of a contract with a tenure fee that varies between 12 and 24 months, and establish a commission percentage of 0.50% to 5%, in addition to the cost of renting the equipment.
For example, in Spain the BBVA bank provides machines for credit cards. Only the installation has a cost of € 300 -which is a single payment- and the expenses generated with its use will depend on the type of terminal you choose: SmartPlay Mobile POS, WiFi POS, Virtual POS, Fixed POS or 3G GPRS POS. However, this institution has a flat rate plan that varies between € 6 and € 10 per month, as long as the turnover does not exceed € 5 million per year.
Scotiabank de México has another way of operating. Commissions vary depending on the type of business – restaurants have a 2.83% rate on credit cards, while gas stations have a 2% rate, for example – and charge a monthly rent that starts at $ 339 Mexican pesos plus VAT up to $ 449 pesos plus VAT. Unlike BBVA in Spain, Scotiabank does not require membership or annuity costs.
Option 2 – Buy a dataphone from a company
Manufacturers of credit card machines sell wireless terminals through various channels. This will depend on the country where you do business. For example, in Colombia you can buy a POS brand Cajero.co directly in the supermarket, but you can also buy them through their website.
In Peru, dataphones are requested directly from provider companies, such as VisaNet. In Spain, there are many companies that offer them, such as SumUp, Prestashop and other local stores. The advantage of buying your own credit and debit card machine is that you can save the annuity and maintenance fee. Also, the transaction fees are usually much lower.
Option 3 – Buy a mobile POS accessory
It is not a very popular alternative, but it is possible! The mobile datáfonos connect directly to a tablet or smart phone via Bluetooth. There are them for both iOS and Android devices, and they work through a mobile application from the manufacturer, which is free. To activate it, you just have to affiliate the account and that’s it. All transactions that are made will reach it.
An example of a mobile POS is iZettle, but there are many others. Search Google for point-of-sale terminal providers near you and evaluate which is the best option for you. Remember to compare the prices of annuity, maintenance, rates and, of course, if they require permanence.