Point of Sale: Commerce Beyond the Surface.

How a Stand-Alone Terminal Can Elevate Your Business.

Written by Rebekah Moss 08 Aug 2019 - 8 minutes reading time

Traditional commerce transactions date back 200 years to the origins of the point of sale machine. At its very core, the point of sale machine began as a cash register. However, it has very much evolved past its usage as an interaction tool between the customer and cashier. Its collocation with an EPS (Electronic payment system) and NFC (near-field communication) deployment software has since elevated business practices worldwide.

What is a POS?

A POS or point of sale terminal is a device used to facilitate face-to-face payment transactions. This is its front-end use. For the Merchant, a POS’s use case far surpasses transactions from a brick-and-mortar store.

In actuality, the POS device first developed from the computerized cash register in the 1970s. Nowadays though, there are very important distinctions in their functionality. A point of sale can be integral to onboarding almost all business operations into one medium. A cash register did, and still does, exist as an actual point of sale. A POS machine (also known as a PDQ) processes data quickly. Extending beyond the point of sale, a POS machine is a CRM system (customer relationship management); with varying levels of employee and inventory management capabilities. Like a cash register, the premise remains the same - the origin of sale begins here.

With the ability to manage commerce and e-commerce simultaneously and in one place, through the facilitating gateways and virtual terminals; there is no reason to doubt the reason why the global point of sale industry stood at $36.86bn less than 6 years ago. With a projected compound gain annually of 11.6% by 2020 there stands to be a definite embrace of POS and the e-market place as coexisting, not separate. In fact, brick-and-mortar sales were still responsible for 80.7% of retail sales in the UK by May 2019.

The application of POS is vast. Though hardware affixations to varying types of terminal exist; it is still mobile POS that is proving the most popular. Back in 2014, both the UK and North America rated mPOS the most important install in retail for consumers; with statistics polling at 53% and North America projected to have a 41% rise in installs by 2020.

Additions to POS terminals tend to include:

Monitors/ tablets.

Barcodes/Scanners.

Credit Card Reader.

Receipt Printer.

Cash Drawer.

Payment Methods

With mPOS growing in popularity, the use of e-wallet payments at NFC-enabled POS terminals is increasing too. With 71% of shoppers using their smart devices in stores, payment methods such as Apple Pay and Google Pay are now commonly accepted via POS terminals; especially by those that accept Visa, Mastercard, American Express and Discover.

Using Near-Field communication technology, both these payments fall under the ‘contactless’ payment category. In some cases, Google Pay will also allow consumers to surpass the £30 spend limit to £100.

There are no additional fees for the customer or Merchant to facilitate Apple Pay or Google Pay, but a customer might be asked to enter a PIN number depending on the payment processor they use.

Apple Pay and Google Pay already utilize NFC security, as well as their encryption methods when transacting payment information through payment gateways. With smartphone technology, they will often have the added layer of biometric authentication too. Other face-to-face payment methods include the standardized Mastercard, Visa and other major issuing banks that facilitate PCI DSS compliance.

What is PCI DSS Compliance?

PCI DSS Compliance was created and implemented by 5 major card brands. American Express, Discover Financial Services, JCB International, Mastercard and Visa mandated the ‘Payment Card Industry Data Security Standard’ to add a security layer to payments made via POS in 2006. Since then, a call to action has been made for more security over the transfer of customer data. Most commonly, this security has been implemented via SSL (secure sockets layer) with the integration of fraud scrubbing. This is also the case in instances of NFC (even when paired with biometric ID access). Forthcoming changes to security include PSD2 SCA which is set to enhance multiple-factor authentication requirements.

Payment Process

The 2 main stages of payment processing are authorisation and settlement. This is where malicious breaches can happen, and encryption thus needs to happen in the transit of card data (SSL and P2PE).

A POS can accept contact (EMV/ Chip and PIN), contactless (NFC) and magstripe payments (swiping the card).

A POS can also accept telephone payments in some cases, but there is an increasing preference for NFC over all other methods. It is estimated that by 2025, 75% of all transactions will be cashless due to its efficiency.

Select terminals may also accept Apple Cash and alternate payment methods depending on their Payment Gateway. However, this does not prevent the consolidation of over 198+ payment methods from your e-commerce sources (as accepted by Total Processing’s Payment Gateway). Payment Gateways aren’t a necessity in POS systems but without one, the Merchant has the hassle of potentially switching back and forth between payment processors and applications to suit both their operations and consumer needs.

POS Features

Integral hardware that manufacturers develop into the POS device are the PIN pad and magnetic stripe reader to facilitate EMV and swipe payments via credit or debit cards. These are the two main ways data are ingested into a complete POS system to be deployed via EPS. Other payments are facilitated by software integration.

POS with a complete payment system is sometimes called an EPS aka an electronic payment system - otherwise known as:

Store EPS deployment model.

The POS EPS deployment model.

An unattended payment system.

The mPOS (NFC and non-NFC).

EPS is typically separate from the POS functions for security reasons, but they can exist on the same interface. The complete POS is referred to as an EPS because EPS facilitates the deployment of data. Different models are designed based on the software and integration of EPS. For instance, NFC does not fit into an EPS model because of its software basis and therefore, it has a different payment deployment system.

Benefits

The benefits of integrating point of sale machines into your business come down to streamlining all your business operations into an accessible hub. Not only can the Merchant or their employees facilitate transactions from the hub aka payment gateway, but will likely be able to manage it from nearby. Sadly, most single-store retailers still do not use POS terminals or other smart technology in their business. This 56% instead implement manual book-keeping methods such as excel and a cash register; or use accounting software - QuickBooks.

Whilst small businesses may not feel the need to integrate POS if they have a small staff or no warehouse to manage stock from; the lack of a POS significantly slows down the business operations otherwise. A small business is missing opportunities afforded by POS software to overview their business in one place to move from start-up position to an ISO merchant account. Studies have shown that 80% of retailers who installed a mPOS saw an increase in their sales.

A POS can be managed on-site and from the cloud. The only difference being how the data from transactions is stored.

An on-premise POS is a greater undertaking; requiring the Merchant to buy one or more licenses to maintain the POS on-site with multiple software installs on their computer. They would typically require an IT technician on-site and be responsible for maintaining the POS machine. This also comes with costly upfront purchases. A cloud POS system allows the POS to be updated automatically via the internet. With lower upfront costs, it can be easily managed by the Merchant for use in their business regardless of size. The added portability of a cloud-based POS allows Merchants to expand their business with ease, adding in the options of pop-up shops or trade show venues.

onsite vs cloud

In both cases, the Merchant must ensure that their POS vendor works with their preferred Payment Gateway and will integrate their business applications and e-commerce platforms.

Payment Gateway

Total Processing is both a POS vendor and a payment processor, providing a Payment Gateway and Merchant services tailored to your business needs.

Total Processing’s Payment Gateway is bespoke.

With the addition of your POS terminal, you’ll have the added security of the following:

Live Insights.

99.99% uptime.

Level 1 PCI DSS Compliance.

198+ payment options.

Fraud protection.

Charge protection.

Recurring payments.

Key POS System Features:

Alongside our payment gateway, implementing a POS terminal into your business will allow you to:

Process daily transactions. Streamline daily business processes. Sales reporting. Inventory management. Customer management. Employee management. Scan and count inventory. Manage stock organisation. Sales and checkout capabilities. Credit Card capabilities. Manage sales from warehouse, store and e-commerce. CRM. Consolidate purchases from all platforms. Track customer purchase history.

Our Services:

Bringing our CRM to your point of sale, Total Processing currently offers the Vega 3000 and MP200 POS models.

MP200:

Mobile device for on-the-go payments.

Bluetooth, Wi-Fi, Micro-USB communications.

Magnetic stripe, contact/contactless, APM's.

Vega 3000C:

Mobile POS device.

Magnetic stripe, contact/contactless, APM's.

Wi-Fi, UMTS (Universal Mobile Telecommunication System) GPRS, CDMA (Code Division Multiple Access), Bluetooth and USB Communications.

Large colour touchscreen ideal for optional customer-facing apps and services.

Integrated thermal receipt printer.

Optional second PIN pad/ card reader.

Vega 3000 M:

Mobile payment device.

Wi-Fi, 3G/4G, Bluetooth and USB communications.

Magnetic stripe, contact, contactless, APM’s.

Large colour touchscreen ideal for optional customer-facing apps and services.

Integrated thermal receipt printer.

Optional charging cradle.

Total Processing offers 24/7 customer support. Our team of developers and payment engineers are on hand to support your Merchant and payment solution needs anytime.

A point of sale system is the optimal integration whether your business is a start-up, staying small or thinking big; with a high volume of transactions. Merchants with ISO accounts will find business consolidation an advanced addition to their business.

Enquire today to get started!

Check out the latest press release on our POS terminals here!

Sources

www.sans.org

House of Commons briefing paper 2019 - Retail Sector in the UK - Chris Rhodes Experian – Global Fraud and Identity Report (2018)

www.fitsmallbusiness.com

www.lightspeedhq.co.uk

www.softwareadvice.com

www.ffccid.io

www.newsindustry.us

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