Payment Equipment Guide
For many merchants, new terminal technology is a must. And there is no lack of qualified equipment from which to choose. From tablets to terminals and from smart cards to smart phones- the list of payment tech considersations is growing everyday. Manufacturers are continually looking to the future as they build in new technologies. With so many choices out there, it can be hard to know what's best for your business.
Payment as a service
The payments business, like most other technologies are moving to the cloud. In most cases the total costs of ownership is lower and the infrastructure, capacity, reliability and service levels are greater with a software as a service (SaaS) model than what a single company could afford to purchase, install, maintain and constantly upgrade with new features on thier own. And payment as a service is no different. With cloud applications, business are finding that the back-up of both they systems they use to run their business as well as the important data bases and sensitive data generated by their organization is a key selling feature of the cloud. Security is another reason. SaaS options have the highest level of internet security possible with firewalls, frequent patches and sophisticated testing. All while providing connectivity to sytems and data after hours or on the road wherever your business might take you.
What's your Roadmap to Next Generation Payment Technology?
As the transformation to the cloud continues, and while legacy mag-stripe cards won’t disappear overnight, there are good reasons for US merchants to migrate to EMV "chip" card technology to greatly reduce fraud from counterfeit mag-stripe cards and serve the next generation of consumer mobile wallets. EMV (Europay, MasterCard and Visa) is the global standard for credit and debit card payments with embedded microprocessor chips that store and protect encrypted account user data. By adapting the core EMV standard, NFC (Near Field Communication) chip technology embedded into smart phones will transform the checkout experience. In the contactless age, you will tap or wave your chip-enabled card or smart phone near a payment pad, instead of swiping or inserting it.
Merchants upgrading now should adopt dual-interface terminals capable of accepting both contact and contactless EMV and NFC. And Visa and MasterCard are pushing merchants to accelerate the US migration to EMV contact and contactless payment terminals with the introduction of new acceptance rules impacting liability for fraud. Effective October 1, 2015, US liability for counterfeit mag-stripe card present point of sale transactions will shift to merchants who do not support chip payment technologies.
We recommend that you begin with a professional consultation to identify the right solution for your business. If that decision leads to the need to acquire a stand alone payment processing terminal, carefully consider the following:
- Avoid buying "hardware" in favor of buying "service". In an environment that is influx and rapidly changing, your best practice is to avoid long term contracts in favor of month-to-month flexibility.
- Strongly consider more than initial equipment costs when shopping. Yes, there will always be someone who will sell you something cheaper but what is your overall cost of ownership.
- Be aware that there are companies that artificially lower the price of equipment simply to lock merchants into long-term processing contracts with stiff cancellation and early termination fees.
- Consider that proper programming is key to implementation success.
- Having your equipment warranty with your processor will save you time, effort and shipping costs in the long run, so choose your processing partner and your terminal purchase as a package based on overall value - a fair deal on both.
- As you know nothing is free. Free equipment offers are laden with monthly and annual service fees, long-term contractual obligations and you never own the terminal so you can't keep it at the end of your commitment. Before you fall for “Free”, think of it as a red flag and closely examine all the fine print to find the catch.
- Equipment that was originally deployed as “Free” but was not returned to the processor can often be found on auction sites. Pay special attention to this risk because these units contain a proprietary chip so that it cannot be reprogrammed for your needs.
- Don't purchase proprietary equipment that will only work on a single processing network will drive up your processing cost in the long run. Choose a unit with many network certifications.
- Is the terminal PCI Compliant? Payment Application Mandates stipulate that no merchant may be boarded on any processor where the payment application is non-compliant. Many units may currently work (grandfathered in) but the ability to support, change programming or reprogram may be discontinued requiring a hardware upgrade. Check with us first.
- Read the stipulations of the price agreement. Is price only valid if you process with them on a long-term 3-year contract with early termination penalty? Is the warranty based on a lease agreement? What is there a warranty/guarantee/return policy? How are shipping, handling, programming and taxes charged?
- Be careful when purchasing used or refurbished terminals. There are many changes in the industry with manufacturers discontinuing terminals and processors retiring payment applications.
- Never LEASE bankcard equipment!! The number one reason not to lease bankcard equipment is that you are upside down before you sign the personal guarantee.
Request a free consultation
At Vantage, we are not equipment driven nor do we rely on terminal sales to keep us in business. Let us help you evaluate your needs and requirements and make payment technology recommedations. Contact us for a professional consultation and a Terminal Services quote to meet your specific requirements.