In 2007, $23 billion worth of sales were conducted using credit cards, and that sum is predicted to grow by 16 percent through 2022, according to CreditCards.com. In order for your business to reap the benefits of credit card sales, it may be necessary for you to obtain a credit card terminal.
- A credit card terminal is a small square or rectangular machine with a magnetic card reader, a digital display and a key pad. In most cases, there is also a receipt printer attached to the terminal or built into it.
- When someone wishes to pay with a credit card, you swipe the card through the reader and enter the amount. The terminal then communicates with the issuing company for the card, such as MasterCard or Visa and displays whether the sale is approved or declined based upon whether the user has funds or credit available for the purchase.
- Most credit card terminals must have a way to communicate data, such as a phone line, modem or cable Internet connection. Alternately, the credit card terminal may be wireless, meaning it uses a modem that can receive and send information within a certain service area without being plugged into a line.
- In order to use a credit card terminal, you must sign up with a merchant services company who handles authorizing the cards and then electronically crediting your bank account with the money that you receive from credit card sales. Merchant services companies usually charge a monthly or per transaction fee as well as a percentage of credit card sales.
- Some merchant services companies will give you a free machine for signing a contract for credit card processing, while others allow you to rent a terminal for between $25 and $100 each month. It is also possible to purchase a credit card terminal with prices ranging from around $150 to $500.
- Some merchants utilize computer-based credit card processing in lieu of a credit card terminal, where credit card information is either typed into or scanned by a computer.
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