Using our phones and tablets as point of sale systems

It is without a doubt that technological innovation has changed many industries beyond recognition, and the boom in mobile technology lately is bringing another wave of change to our lives. This is true for payment systems as well.

In this blog I want to examine several startups that are providing mobile POS System, but firstly, let me explain what is POS – it actually means the point of sale (the place and time) where money changes hands. In most of 19th and 20th century payments were made by cash or check, and merchants were using registers1 like those to record the transaction and store the money.

The next evolution of POS systems came with the beginning of barcode usage – the year was 1974 when the first barcode item was scanned in a store. With the evolution of computers and barcode scanners, businesses were able to increase the time for processing sales, as well as the accuracy of sales. Since then, companies have added a card swipe devices for accepting credit and debit cards and signature pads to accommodate customers.

The POS systems alone in the last century were transformed immensely and with the rise of mobile computing comes the rise of mobile phones as POS, which in my opinion will be incredibly useful, especially with the integration of the right accounting/management software.

Nowadays an efficient and well maintained and running payment system is integral part of the sufficient functioning of the global economy. Thus electronic payment products serve to provide speedier, cheaper and glitch-less experience to customers. The current evolution of payment services provides us the ability to use our smartphones and tablets as mobile payments systems, with credit card swipes and seamless software integration for card processing. This provides opportunity for small businesses and freelancers to react in the fast paced economy.

How Mobile card processing works?

Mobile credit card processing services let businesses and freelancers use a smartphone/tablet to take payments anywhere there is mobile service.  First you choose the correct service for you (find a comparison table in the end of this post), sign-up to get an account, then you will receive a card swiper, which you can connect to your iPhone/Android  Phone/Blackberry. Afterwards you download the respective app, sign in with your credentials and you are ready to start processing transactions immediately. There is a percentage you need to pay for the service you are using or a monthly fee, depending on the plan you choose.

The best part is that the app will provide you with extensive analytics tools to track your sales, etc.

How safe it is?

All the services compared in this blog post are complying with Payment Card Industry Data Security Standard (PCI-DSS). PCI-DSS is a set of policies and procedures to enhance the security of credit, debit and cash transactions as well as protect cardholder information.

Additionally it is important to say that no cardholder information is stored on the merchant’s device at any point of the transaction. Even if the phone/tablet is currently without connection, the information is not stored on the device, but is instead stored as an encrypted file and is transmitted instantly when the device is back online.

Choosing the Best Mobile Payment Service

When you decide to add mobile credit card processing service to your business, it is important to research well what will be the best solution for you. Things you might need to consider include:

  1. Region of service – this is probably the first thing you need to check when considering mobile card processing service. Currently not all services work worldwide, although almost all are working in USA, Germany and UK.
  2. Mobile OS Support – you should consider the type of service that has an app and card swiper for your respective mobile device – generally most services have provided options for iOS(Apple devices), Android and Blackberry, but you should check nonetheless.
  3. Device – check additionally if you need to pay for the device or it comes for free as part of the service.
  4. Card types – check which card providers the service supports – Mastercard, Visa, American Express, etc. Not all services support all card providers.
  5. Software – consider the type of software that will fit your business needs perfectly – whether it has more options, how user-friendly it is, what type of analytics it provides, does it consider sales tax depending on the region you are doing business in, etc.
  6. Fees – check whether you need to pay monthly fees, as well as how much the service gets for every swipe you do. The percentage of the amount varies from service to service.

Finally, check out the comparison table here and the presentation that covers the basic features of all services I’ve researched. Hopefully this blog post was useful, I know I’ve learned a lot of interesting things!

or you can see the comparison table I’ve made

  1. The first cash register was invented by James Ritty, who invented  the register in 1879 and was patented in 1883