Payment processing has long been a contentious point of discussion in the small business world. It is a necessity but can be a costly attribute of business ownership. In addition to the processing fees assessed after a transaction has been completed, there are the hardware aspects of payment processing to consider. Upgrading your payment terminals to accept emerging consumer payment types can be a difficult challenge.
What Defines a Virtual Terminal?
A credit card processing virtual terminal can help with both of these key areas by introducing flexibility in how you manage payments. A virtual payment terminal can operate in one of two ways. The first is to accept physical payment types that use NFC (near field contact) technology. These provide a contactless payment option that only involves moving a physical credit card or device through the field of the payment terminal or the scanning of a payment barcode via a smartphone app or digital wallet.
The second type of virtual terminal is more faithful to the term. This virtual terminal type sits in the cloud and does not require a physical presence of any kind. Payment authentication is performed using encrypted payment information that flows from a payment app and through your payment processor before landing into your business accounts. The great thing about this option, outside of the lack of hardware requirements, is that you likely already have it in place if you engage in eCommerce.
Do I Need Special Hardware to Operate a Virtual Terminal?
For a true virtual payment scenario, the answer would appear to be a resounding “no.” However, you and your staff need a way to interact with the transaction while it is occurring, whether or not the transaction takes place in a physical business or your virtual storefront. So regardless of the type of payment terminal you employ, some form of hardware will be needed to carry out in-person transactions and monitor eCommerce sales.
The type of hardware you need will change when using a proper virtual payment terminal. As we noted above, NFC card readers may be considered virtual only because they are contactless. However, virtual terminals only operate using an app or web-based software. This means that the only hardware you need to run a virtual payment terminal is an internet-enabled device. The most common forms of hardware used for virtual payments are laptops, smartphones, or tablets.
Does This Mean I Need an App?
Although using an app for a virtual terminal is a nice touch, it does not need to be considered a necessity. A virtual payment app will likely come in the form of a mobile payment app and should offer you the same visibility into a customer’s order and payment information as viewing it on web-based payment software or even a traditional payment register. A virtual payment app should also include a list of your inventory for reference to ensure smoother transactions.
Top-of-the-line POS systems will offer other ways to accept virtual payments outside of using an app. Web-based invoicing software is a common virtual payment type employed by small businesses, given its simplicity to use. The most highly rated of these invoicing tools come pre-integrated into a POS system and provide digital invoicing and online payment options that simplify the payment process for all parties.
Where Does My Transaction Information Go?
Virtual terminals must be able to communicate to your business software, payment processor, and financial institution. But these communications need to be secure and adhere to the PCI DSS compliance level that best applies to you. The most effective way to track all of the information you use for payments and inventory is to rely on a virtual terminal solution that your POS vendor provides.
Taking this avenue means that security remains consistent across the board. Also, virtual payment processing terms will be more favorable, especially when you are using a POS solutions provider that works with you to negotiate these terms. This gives you a fixed cost point when accepting payments and makes your POS system a one-stop platform for all of your business and security functions.
How Can I Increase Customers’ Engagement?
Using payment options to attract customers is a difficult sell using the traditional approaches to payment terminals. But with virtual payment terminals, the ability to reach more customers becomes easier, thanks to the ability to engage potential customers through broader use of engagement channels. The added convenience that comes from being offered multiple payment platform choices will add that special touch to your brand that will drive customer retention and word-of-mouth recommendations.
Don’t Wait to Build a Credit Card Processing Virtual Terminal Strategy
The virtual payment world continues to grow at a quickening pace, making your decision to accept these payment forms a wise choice. Before you build a virtual terminal strategy, you must first ensure that you have the infrastructure necessary to support these plans. Additionally, you will want a POS provider that not only builds your technical solution but supports both the underlying technology and the background nuances of payment processing negotiations.
With virtual payment processing quickly becoming a must-have for small businesses, talech consultants can help you switch gears from traditional credit card processing to the world of virtual terminals. We work to align your business strategy with technology that supports your ability to accept an almost limitless array of payment types.
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