When choosing tools to support your payment acceptance strategy, the types of credit card machines and terminals you outfit your business with matter. Not all devices take contactless payments or work with existing systems. Some have built-in receipt printers, whereas others email or text billing statements.
Understanding the differences between payment devices helps your business get the most out of its budget. Discover your options and learn how to choose the best credit card processing machines for small businesses.
What are credit card machines and terminals?
Credit card machines and terminals are payment processing hardware for accepting electronic payments, like credit and debit cards. Their main purpose is to capture card information and authenticate the payment method before sending the data to the processor. The equipment will decline nonworking or expired cards.
Credit card machines include the following features:
- PIN pad: Customers enter their PIN on the keypad and authorize the payment.
- Screen: The display shows the transaction total and notifies the customer or staff when the payment is approved or declined.
- Card reader: This component reads the card data based on the type of credit card (Europay, Mastercard, and Visa [EMV] chip or traditional magnetic swipe).
- Network connection: Card terminals access the internet to send data to the processor to begin the authorization process.
- Printer: Many, though not all, portable credit card terminals have built-in receipt printers and others connect to external devices.
Credit card processing hardware offers several other features besides the above components. Handheld units often have built-in barcode scanners and one or two cameras. Tablet-style models provide touchscreens, and the equipment may integrate with various accessories and add-ons.
[Read more: What You Need to Know About Credit Card Processing]
How do credit card processing machines work?
Credit card processing devices collect cardholder data from the magnetic stripe or EMV chip when a customer swipes or inserts their card. Then, the card readers, point-of-sale (POS) terminals, or credit card machines transfer the information to the payment service provider (PSP) over a wired, Bluetooth, or wireless network connection.
Once the authorization process is finalized, the credit card processor forwards the approval or denial code (which comes from the cardholder’s financial institution). Within seconds, your customer's transaction is complete. A statement prints automatically from a built-in or stand-alone receipt printer, or you may have the option to email or text the receipt to customers.
The right payment processing hardware improves customer experiences and increases efficiency.
Types of credit card machines and payment terminals
Most credit card processing providers and equipment brands offer several types of business credit card machines, readers, and terminals. The options differ in price, processing speed, and portability. While the cheapest versions provide a keypad and few additional features, more expensive hardware includes full POS functionality.
Stand-alone credit card terminals
If you have ever paid with a credit card at a checkout counter, you have most likely encountered this traditional device. Countertop payment terminals accept credit and debit card payments; some are set up for Electronic Benefits Transfer transactions. These units typically connect to POS software. Although slight differences exist between brands, the basic features remain the same.
- Best for: face-to-face transactions at brick-and-mortar businesses and taking payments over the phone.
- Functionality: Devices have an EMV chip reader, a magnetic stripe reader, a keypad, and a small screen. Newer hardware also supports near-field communication (NFC), which allows customers to tap to pay for contactless transactions.
- Pricing: $100 to over $300.
- Network connection: hard-wired phone or ethernet.
[Read more: 10 Best Practices for Streamlining Payment Processing]
Wireless credit card machines
Hand-held credit card terminals come in two varieties. One version is a portable card reader similar to a basic countertop machine. It's durable and built to accept payments curbside or at the table. A smart terminal or mobile POS system (mPOS) is the other option. Entrepreneurs can manage inventory and customer profiles from the portable tablet or phone-sized unit.
- Best for: businesses wanting the flexibility to process payments indoors or out or that prefer a smaller POS unit.
- Functionality: Most devices support chip, swipe, and contactless payments. The terminals have a screen and keypad or touchscreen; some offer printers, barcode scanners, cameras, and POS software.
- Pricing: $199 to $599.
- Network connection: Bluetooth, WiFi, wireless cellular, or wired ethernet.
POS terminals with built-in card readers
All-in-one POS systems provide the complete package: software, hardware, and payment processing. They offer one or two displays and industry-specific features, like restaurant floor plan management and ingredient tracking. Most also sync with accessories, from self-service kiosks to barcode scanners.
- Best for: retailers and restaurants with medium to high sales volumes.
- Functionality: POS machines accept most payment methods and have touchscreens, POS software, and built-in or integrated printers, cameras, and cash drawers.
- Pricing: $700 to over $2,000.
- Network connection: wired ethernet, WiFi, or Bluetooth.
Mobile credit card readers
Mobile card readers are small devices that attach to smartphones or tablets through an audio jack, Lightning connection, or Bluetooth. Most vendors that support mobile readers provide payment apps. You can use the mobile app or a virtual terminal to process payments without the card reader, but swiping, tapping, or inserting cards reduces credit card processing fees.
- Best for: service providers, market vendors, freelancers, and consultants.
- Functionality: The devices have a magnetic stripe reader, and advanced models include EMV chip readers and NFC/contactless payments.
- Pricing: Free to $125.
- Network connection: wireless cellular or WiFi.
Popular payment terminals and card machine options
Credit card processors like Helcim, Clover, and Stax offer proprietary hardware designed by their companies to provide excellent payment experiences. However, in some cases, merchant account providers reprogram existing credit card terminals. Other vendors sell third-party devices and integrate with your POS system.
Here are some standard payment processing hardware solutions:
- Dejavoo: This fintech company offers nearly every kind of device, and many merchant account services sell Dejavoo models.
- Verifone: This payment solution provider supplies mobile and countertop units and works with several processing services.
- Pax: This vendor manufactures payment terminals and POS products known for their reliability, which is why they're a popular option with processing plans.
- SwipeSimple: CardFlight designs SwipeSimple card readers, smart terminals, and POS systems, which are resold by multiple PSPs.
- Clover: This Fiserv company provides payment processing and hardware. Many card processors also resell Clover systems.
How to choose a credit card machine or terminal
The different types of credit card machines are designed to accommodate startups, growing businesses, and high-volume sellers. Knowing your company's current state and direction can help you plan accordingly. The right payment terminal is one slice of a larger strategy toward better customer experiences and increased sales.
Consider the following factors when choosing the best credit card machine for your small business:
- Business model: Your company's way of earning money and delivering value to customers impacts your choice. A single-location, self-service buffet may prefer countertop units, whereas a diner with delivery needs mobile options.
- Processing volume and frequency: Credit card terminals have different processing speeds based on product specifications and network connections. Ensure your equipment meets your traffic volume.
- Payment methods: Although credit card machines support major card brands, not all accept NFC payments. When possible, get a terminal that lets customers dip, swipe, and tap.
- Portability: If you need flexibility to move your hardware between locations, consider your network connection options, battery life, and the location of electrical outlets.
- Compatibility: Your device must work with your credit card processing company and should integrate with existing POS systems and printers.
- Ease of use: Look for hardware that anyone in your company can use with minimal training, and always test it out from the customer's point of view.
- Security: Major brands sell Payment Card Industry-compliant terminals with advanced features to protect businesses and consumers. Always review security information before purchasing a credit card machine.
- Cost: Weigh the benefits of functionality and reliability against the price to find the right fit for your company. If you're getting a machine as part of a merchant account agreement, look over the contract terms to see your responsibilities if it breaks or you cancel early.
[Read more: What Is a Secure Payment System?]
Credit card machine and terminal providers
When looking for the best credit card machine for your small business, consider offers from payment processors or terminals that can be reprogrammed if you switch services. Many vendors have solutions for multichannel sales, including e-commerce platforms, mobile terminals, and invoicing tools.
Here are a few payment service providers who sell processing hardware:
- Helcim: Pair the smart reader with any device or select the stand-alone smart terminal. Then, use Helcim's free POS software to accept payments and see sales insights.
- Payment Depot: Get a custom quote for interchange plus pricing and choose from SwipeSimple, Clover, and Dejavoo terminals.
- Square: Choose from a large selection of iPad-compatible hardware, including POS cash registers and kits.
- Stax: You can use Dejavoo, SwipeSimple, and Clover products independently or integrate them with APIs.
- ProMerchant: Companies that sign up with ProMerchant may qualify for a free Pax A920 terminal or a Bluetooth card reader.
- Merchant One: Customers who set up a new merchant account can select a complimentary Verifone or Pax terminal.
- Clover: Select mobile terminals, countertop devices, or kiosks to equip your store or restaurant with a custom system.
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