Today’s commercial landscape is a patchwork of buying and payment options. Customers can make their purchases in person at a physical store, online, by mail order, and over the phone.
As a merchant, you need to decide how you are going to accept funds from them in exchange for your products and services. Start by understanding the crucial differences between a virtual terminal and a point of sale (POS) system.
What is a virtual terminal?
A virtual terminal is a secure online payment platform specifically designed to process transactions, without the need for a connection with a POS terminal.
That makes it ideal for businesses whose customers buy products or services via phone, mail order, or at a remote location where internet connectivity is nonexistent or unreliable.
A virtual terminal accepts payments without the need for a physical POS. It facilitates secure payment processing from any location via a variety of sources.
Most virtual terminals can accept a variety of payment methods, including credit and debit cards and automated clearing house (ACH) transfers from the customer’s bank. Instead of using a card reader to gather payment data, the virtual terminal requires that the merchant manually enter the transaction and payment details into the unit.
There are several benefits of virtual terminals. They are flexible, enabling you to accept payments from anywhere.
Furthermore, they are well-suited to specialized tasks, such as processing restaurant phone orders, facilitating mail order purchases, and taking payment details over the phone from clients who are uncomfortable making online purchases.
What is a point of sale solution?
Point of sale solutions are multi-functional. In addition to facilitating secure payments, they assist in streamlining various aspects of business operations, including inventory and employee management, customer relationships, integration with third-party software, and report generation.
A POS is a combination of hardware and software.
The hardware includes a terminal or tablet that displays product information and advertising and promotions to the customer during the purchase, an attached or wireless card reader to take in the buyer’s data, and peripherals like barcode scanners, cash drawers, and receipt printers.
A software package communicates with the payment provider or processor to complete the transaction. In addition, the software includes a host of features that can help a merchant to optimize many of its vital business functions.
With the help of a modern POS solution, business owners can keep track of product quantities in real time, enabling them to order proactively to prevent shortfalls. Additionally, the system’s database tools allow sellers to set up customer loyalty programs and enact niche email and texting campaigns targeted to the individual needs of each recipient.
Also using the hundreds of data points stored in the system, a POS can be harnessed to generate reports on sales and employee productivity, shopping behaviors, and profits and losses that can be used to take the pulse of a business at any point, create intelligent marketing campaigns, and make smart forecasts about future inventory.
Virtual terminals vs. point of sale systems.
Virtual terminals perform a limited but vital function. They can either stand alone, or act as a component of a larger POS.
Although virtual terminals and POS solutions are sometimes confused with each other, they are not equal. With the addition of a virtual terminal, a business can expand its payment acceptance capabilities beyond the standard card-present or ecommerce checkout methods. With your assistance, their information can be securely inputted and sent for processing no matter where the transaction takes place or how it is done.
Certain businesses need nothing more than a virtual terminal. Those just starting out or that only take remote payments may be able to use only this low-cost method. Others with more complex needs can simply have virtual terminal capabilities added to their POS package.
As a business owner, it is in your best interest to have as many secure ways for your customers to pay as possible. Virtual terminals, often in tandem with a larger POS, provide added flexibility and versatility to businesses of all types. If you want to augment your systems to accept transactions via a virtual terminal, talk to your payment provider today.
