Small business owners, take note: upgrading or buying new POS card terminals has become more complex. As the following article indicates, selecting the right type of terminal will significantly impact your business.
Credit-card processors have changed a lot in recent years, and if you’ve been in business for a while, you might be thinking about upgrading your systems. Perhaps you are looking to get an EMV chip reader, or want to add near-field-communication (NFC) technologies to your reader for processing mobile phone and wearable tech transactions. Whatever the reason for needing new card readers, there are a few things to keep in mind as you choose a vendor.
Near-field-communication technology can help you process payments from mobile wallets or emerging wearable tech, such as rings, smart watches, stickers or key chains. Acquiring this tech is reasonably priced and worth considering if you think your customers will want to make payments using this type of technology. This tech is also necessary if you want to process mobile-wallet-type loyalty or gift cards. You may feel pressured to enter a long-term leasing agreement. If you can, avoid it. Online reviews are laden with bad experiences and tales of warning.
In the long run, you could save thousands by purchasing the card readers outright, even if you have to use a credit card to do it. Most new EMV chip- card readers are about $200 for a single unit. If you lease the readers, you might pay $50 or more, per month per machine, for three years. That adds up to $3,600, which is significantly more than just buying the readers. Some leasing agreements will even include an automatic contract renewal, so if you are not paying close attention you may find yourself in another three (or more) year agreement that may prove difficult to get out of.
There are a variety of technologies available for your customers to consent to payment. The most common way is entering a PIN, so many credit-card machines will have a connected PIN pad. But you may also want to include a signature device for those who need to sign for their credit-card purchases. You can choose from one that allows customers to sign on a screen or on a signature pad. As mentioned, you may also want to consider adding NFC technologies for additional options. Biometric technologies are beginning to become available, but are not commonly used at this time.
Even more important advice that choosing the right POS terminals is to select the right payments vendor(s) for your business. Smaller merchants are totally immersed in running their businesses. Spend more time finding the most transparent and open payments vendor, and the POS terminal selection process will be a non-event.
Overview by Raymond Pucci, Associate Director, Research Services at Mercator Advisory Group
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