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Overview
There once was a popular restaurant chain that proudly did not accept credit cards. This chain catered only to the cash-carrying customer. As times changed, the wallets of consumers changed, too. The chain had to adapt to its customers' needs and, after getting a crash course in the equipment needed, finally began accepting plastic as a form of payment. That company is still thriving today.
What Kind of Equipment Do I Need to Process Credit Cards?
Swipe Terminal
A swipe terminal reads the encoded strip on the credit card. There are two types of swiping units--the slider and the insert reader. The slider is mostly used by merchants, who slide the card through the reader. The insert unit is more commonly used as a self-service device, such as at a gas pump. There, the user inserts the card into the terminal, pulls it out and waits for approval to proceed.
Connection
After the swiping unit reads the card, it needs an Internet or phone connection to send the data to the credit card company. The transaction will then either be approved or denied by the card company. The result of the transaction will be sent immediately back to the merchant to be printed out for the customer.
Printer
A receipt printer will be needed to print out the result of the transaction for the customer. Even if the card is denied, the credit card company will still send back information to be printed on a receipt. Often, a customer will ask for proof of the denial, and the merchant must be able to provide this information on a receipt--as well as the approved transaction. Multiple rolls of printer paper and ink cartridges should be kept on hand, as the credit card printer will (hopefully) get a lot of use.
All-in-one
There are companies that provide all-in-one systems for credit card transactions. These systems are known as POS (point of sale) systems. They include everything needed for a business to process credit cards. Most companies that sell POS systems also provide service when the equipment breaks down. Day-to-day maintenance, such as replacing printer ink, is up to the merchant.
Older equipment
In the old days, a merchant would take a customer's card and swipe it between sheets of carbon paper in a hard shell plastic and metal swiping unit. This method is still used, but only by merchants who don't have immediate access to an Internet or phone connection to the credit card company. The merchant will give one carbon copy receipt to the customer, keep one for himself and mail the third one to the credit card company for processing. This process can take up to a month.
