Processing requires hardware and other fixed assets. The typical small merchant may have only a terminal attached to a register/accounting system. These terminals are designed to read card magnetic stripes and authorize and settle transactions. These terminals can be designed to communicate via an analog or dial-up phone line or via Internet protocol. Small merchants often lease or rent terminals or buy them outright. Communications costs can be as low as that price of a single dedicated phone line for the smallest merchants or considerably more if dedicated lines or wireless or satellite transmissions are utilized.
Larger merchants have substantially more sophisticated and investment-intensive systems. These retailers will often have a host-based system which resides in the back-office or a central location. The host system aggregates, records, and transmits transactions from point-of-sale systems. Merchants such as gas stations may also use technology such as pay-at-the-pump systems and satellite based communications. There is also a cost associated with the software and outsourced services of Internet or telephone transaction capabilities.
1. Ten Most Popular POS Terminals
Eclipse terminal
Hypercom T7 Plus terminal
LinkPoint AIO terminal
Lipman Nurit 8000 terminal
VeriFone Omni 3750 terminal
BankPoint II PIN pad
VeriFone 1000 SE PIN pad
Hypercom S9 PIN pad
VeriFone printer 900
MagTek check reader
Sources: First Annapolis Consulting analysis, The Acquiring Industry Basic Training 101, ETA sponsored presentation, Transaction Trends magazine, January 2006.