Differences Between A POS Terminal and A Credit Card Machine

Differences Between A POS Terminal and A Credit Card Machine

Credit Card Machine vs. Point-of-Sale System

We live in a day and age where automation is a requirement for any business to thrive. It could be anything from automating orders to inventory.

Getting transactions on this bandwagon is particularly beneficial. It allows you to save on time, maximize service delivery, and secure your business’s profits.

When it comes to automation of transactions, there are two primary options: POS systems and credit card terminals.

So what exactly are the differences between these two popular systems?

In this post, we offer the answer in the form of a comprehensive comparison of the two, to help you if you are considering an upgrade you will have a better idea of what works best for you.

What Are The Differences Between A POS Terminal and a Credit Card Machine?

Credit card machines are devices designed to facilitate payment using credit cards or debit cards.

They make use of third party credit card processors to create a link between the client, the business, and their respective banks.

That way, there are direct money transfers from the buyer to the seller to pay for items purchased.

POS in full is point-of-sale.

A POS system is designed to facilitate the integration of different aspects of the business.

The systems usually run on information collected during sales.

This includes things like the items sold, the number of units, mode of payment used, and so much more.

Scope of Capabilities

Credit card readers are limited in terms of what they allow you to do as a business.

Essentially, all they do is allow payment using cards.

However, more modern systems are expandable to allow transactions through mobile money service providers like PayPal and Apple Pay.

POS systems, on the other hand, have a broad scope of functionality.

 First and foremost they facilitate hard cash payment allowing tracking of cash flow in the business.

They can also be used to process non-cash payment including gift cards and store loyalty credits.

In addition to payment processing, these systems can be used to track inventory, scan barcodes, secure cash drawers, and monitor employee hours.

Transaction Speed Differences

Credit card machines are designed to be very fast.

Full POS system or Credit Card Machine

This is because all they do is facilitate the transfer of funds from one account to another. 

You can have it done in a matter of seconds if you are using something like a magnetic strip swiping machine.

Or it can take a little longer for a chip-based card that needs to be inserted and processed. Either way, the transactions are pretty fast. 

POS systems are a little slow compared to credit card machines.

However, this does not reflect on their efficiency as transaction automating systems.

The main reason why they take so long is that they run a lot more functions.

They, therefore, need a lot more data fed into them.

All the barcode scanning for different products and payment confirmation is bound to cause some delay.

What Payment Processing Machine Is Easiest To Use?

Credit card machines are pretty easy to use.

There are generally three types available.

The first is the swiping machine for cards with magnetic strips. Here the client swipes their card, and all the needed data is fed into the system.

Another equally fast and efficient system is the tap machine. This one gathers all the needed information with simple contact between the device and the card.

The final option is the insertion machine for EMV chip cards. These take a little longer but are more secure for your customers.

POS systems are also pretty easy to use.

The majority of the steps are automated.

The person running the system will only have to pass the items over the barcode scanner, enter payment details, and give change if there is any.

It might take longer than with simple credit card machines, but it is still a pretty easy and straightforward process.

What Applications Are Available On Payment Processing Machines?

Credit card machines can be used in retail and service industries.

However, their limitations in terms of monitoring employees and stock control make them better suited for the service industry.

This includes businesses like restaurants and beauty parlors where receipts can easily be written by hand. 

POS systems offer multi-functionality which would allow service, retail, and wholesale businesses very well. POS terminal for a restaurant

Point-of-sale is also an excellent option for companies with heavy client traffic.

This is because it makes it very easy to serve them all quickly and efficiently without losing track of things like inventory and cash flow.

Pros and Cons of Credit Card Machines

Pros:
  1. They are very fast.

  2. They are convenient.

  3. Cashless transactions are very secure.

  4. It is easy to use.

Cons:
  1. They are limited in terms of functionality offered to the business.

  2. They only facilitate payment by credit or debit card and no other payment options.

Pros and Cons of Point-of-Sale Systems

Pros:
  1. They are multifunctional, serving different purposes to the business.
  2. They can be expanded and customized to meet the client’s specific needs.

  3. They facilitate the monitoring of inventory, money, and employees.

  4. They allow the use of many different payment forms.

Cons:
  1. Most decent POS systems are a costly investment.

  2. POS is not fully automated and relies heavily on manual input.

What Credit Card Processing System Should I Choose?

So, what are the differences between a POS system and a credit card machine?

The answer is simple: just the scope of functionality.

At the end of the day, it is your priorities and your business’s specific needs that make all the difference.

If you want a system that does it all for you from keeping stock to securing hard cash, then it goes without saying that the POS system is the best choice.

If, on the other hand, you are simply in the market for something to help you run smoother and more convenient transactions, then credit card machines are the way to go.

But you know what?

You may not have to choose.

If your budget is flexible enough to accommodate investing in both, then there is no reason to not have both.

All you have to do is ensure that both systems are configured to work together.

That way the card machine facilitates payment whereas the POS integrates the rest of the business for efficiency.

Process Credit Card Payments With EMS Today!

The bottom line is that there are a lot of differences to consider when choosing between a point-of-sale terminal and a credit card machine.

Discover more about which payment processing system fits your company the best by speaking with one of our experienced sales representatives at Electronic Merchant Systems.

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P.S. If you think a full POS is what you need, check out this article about how to choosing the best POS system for your business.