The Green Sheet Online Edition
June 6, 2011 • 11:06:02
Counterintuitive selling
POS device manufacturers have been telling us for years that their products are more than just terminals. Now with the apps race in full swing, we're seeing a variety of nonterminal solutions designed for a new generation of merchants. The rush to embrace clouds, mobility, integrated systems and virtual machines has some payment professionals wondering if there's a future for traditional credit card devices.
A weakened global economy, combined with a mature and consolidated payments industry, has slowed unit sales of EFT-POS terminals in general, but traditional countertop terminals still represent a viable and affordable option for small merchants. In fact, there has never been a better time to market countertop devices to qualified buyers.
While your competitors are pushing such higher ticket items as portable wireless and integrated POS systems, which typically take longer to sell and have their fair share of implementation and support issues, you could be selling terminals out of your auto's trunk that are ready to install.
Terminals have evolved
The market for countertop terminals remains strong, and the units themselves have evolved in parallel with changing consumer behavior. Many new offerings in the countertop terminal family require little to no training and come with factory-loaded applications and overnight replacement guarantees.
You'll be well-received by mom-and-pop merchants who don't want to upgrade their cash registers or use computers or mobile phones to process credit cards. Many of today's hardworking business owners want simple, secure, standalone solutions with small footprints and toll free 24/7 live help desk support.
Just as the phone evolved from a rotary dial apparatus into a small, portable, personal digital assistant with its own set of accessories, today's credit card terminal is compact and configurable, with multiple communications options and the ability to support an array of ancillary, nonpayment applications.
The innovation occurring at the terminal hardware level is just as eye-popping as changes taking place in other industries. In fact, the impact of these transformative technologies is affecting every aspect of life, from entertainment to health care, agriculture to education. What began as a digital revolution has become a platform for the human experience.
Expectations have changed
TranSEND Integrated Technologies has been providing transaction processing solutions to the payments industry since 2003.
The company's Chief Executive Officer and President Amit Chhabra and his team of engineers have worked with processors, technology companies and major terminal manufacturers on a range of terminal-based technologies and front- and back-end network solutions. TranSEND employs its own systems integration expertise to configure, customize and deliver comprehensive integrated solutions.
"As technology evolves, so does the increasing expectation of what it should be doing for us," Chhabra said. "We see this in every industry where electronics play a central role in the operations of that industry. The payments industry is no different, and the expectation on payment terminals is no different. It is no longer sufficient for a payment terminal to just receive a swipe of a card, prompt for amount and print a receipt.
"Payment terminals today are expected to have built-in support mechanisms, offer merchants choices for operating their business, and provide information services to the merchant.
Enabling these features requires payment device platforms that provide for feature scalability, which starts from platform features of either an open operating system (like Linux) or a feature rich proprietary operating system, multi-application/multithreaded environment, a fast micro processor (200 megahertz or more), and extensive user control libraries to provide an easy to use user experience."
It's not only software architecture that has undergone a transformation: the changing face of POS is reflected in the sleek low profile of new POS devices. This new generation of terminals is not only an extension of the surrounding retail environment, but a hybrid of traditional countertop and customer-facing, multilane devices.
Components have improved
Other leading trends in countertop design by POS manufacturers can be found in the individual components that make up a device. These include:
- Keypads: Softer materials such as rubber are replacing the plastic keypads seen in many older terminals, giving the devices a friendlier feel, improved performance and a matte finish that makes letters and numbers easier to read.
- Printers: Merchants may not think about printer speed, but they certainly don't want to turn off their customers or slow down sales. Most new terminals exceed the line-per-second print speeds of older terminals. This simple fact can be used as a tangible comparison when selling new against old and value over price.
- Displays: The best differentiator when comparing older terminals with new ones is the display screens. Many older models have two line displays, and the plastic that was used had a tendency to cloud up over time. The new terminals have wider, deeper display screens, and we're seeing more varieties of touch-screen technology or "hot keys" that are placed alongside the display that make it easier than ever for end-users to navigate through menus.
- Card readers: Today there are more choices in credit card reader technology and form factors. Most new terminals have both smart card and magnetic stripe readers. As an additional security measure, some card readers have built-in encryption capability.
MagTek Inc., a global leader in security and card encryption technology, is one of the leading developers of technologies that authenticate credit cards and encrypt transactions at the card swipe. Its secure card reader authenticators, check scanners, PIN pads and credential-issuing systems provide safe and efficient electronic payments and identification technology.
- Modems: Today's multiple communications options for countertop terminals include dial, wireless, Wi-Fi, and Ethernet. Most dual-communication models are designed to "fail-over" when a primary protocol shuts down. This is a reliable feature for high-volume merchants.
- Central processing units: Multi-application environments are an established requirement in the U.S. market, which means terminal manufacturers have had to beef up their core processors to keep up with complex, feature-rich data and security requirements.
As anyone who has ever tried to add a gift card or bill pay app to an older, single application device can tell you, it's easier and less expensive to upgrade than to try to fit 21st century technology into an analog device. Additionally, the risks of working with noncompliant Payment Card Industry PIN entry devices will always outweigh the rewards.
- Cable options: USB and serial port connections are included in most new terminals, smart phones and laptops to accommodate an expanding array of peripherals, and sometimes they allow the devices themselves to be used as peripherals.
- Counter intelligence: In the quarter century since the release of VeriFone Inc.'s Tranz330 and Hypercom Corp.'s T7P, credit card terminals have been adapting to the changing POS environment - from their components to their communications options to their functionality and uses.
We're fortunate to be selling in such a rich and varied environment where we can fine tune a processing system to meet the needs of any merchant.
We all have our high-end, defining products, but there's still a market for traditional credit card terminals. Sometimes it pays to sell the counterintuitive, simple solution, especially when the counter is yours to win.
Dale S. Laszig is Senior Vice President of Sales in the United States for Castles Technology Co. Ltd., a manufacturer and global provider of smart card, contactless and POS solutions. She can be reached at 973-930-0331 or dale_laszig@castech.com.tw.
Whether you want to upgrade your POS offerings, find a payment gateway partner, bone up on fintech regs or PCI requirements, find an upcoming trade show, read about faster payments, or discover the latest innovations in merchant acquiring, The Green Sheet is the resource for you. Since 1983, we've helped empower and connect payments professionals, starting with the merchant level salespeople who bring tailored payment acceptance and digital commerce tools, along with a host of other business services to merchants across the globe. The Green Sheet Inc. is also a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals.
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