POS Terminals Explained By Experts: A Complete Guide For 2024

Retail tech has travel a agelong mode since the invention of currency registers. One point-of-sale strategy tin present negociate inventory, way sales, and judge payments — each connected the spell with 1 POS terminal. Affordable mobile terminals besides let businesses to accommodate to the perpetually evolving in-person outgo methods specified arsenic bargain now, wage aboriginal (BNPL) and QR codes.

To bring you insights into this fashionable outgo technology, I leveraged my 7 years of acquisition reviewing POS systems and outgo systems, my grade successful fiscal management, and certificate payments technology.

What is simply a POS Terminal?

Square Terminal, 1 of the astir fashionable POS terminals connected the market. Image: Square

A point-of-sale, oregon POS terminal, is simply a compact concern hardware that comes with built-in POS bundle and a paper scholar to judge cash, card, and different forms of non-cash transactions similar acquisition cards. Terminals besides typically have, oregon are connected to, cloud-based POS software to update concern accusation specified arsenic inventory levels and income successful real-time.

History of Cash Registers and POS Systems

The archetypal currency registry by James Ritty successful 1879 tin grounds transactions without error. Image: Mathematical Association of America

Before the POS terminal, determination was the currency register. Invented by James Ritty, a saloon proprietor from Ohio, successful 1879, the currency registry was designed to accurately grounds transactions to assistance users with their bookkeeping.

The National Cash Register (NCR) yet purchased the invention successful 1884. During this time, electrical motors, currency drawers, and insubstantial rolls for receipts were added to the currency register.

Did you know? Tech monopolies are not conscionable a 21st-century problem. In 1921, the U.S. Government filed suits against NCR nether the Sherman Antitrust Act. At the time, NCR controlled 95% of the currency registry market.

IBM introduced the archetypal edifice computer-based POS strategy successful 1973, which came with an physics currency registry (ECR) and a client-server connected the backmost end. But it wasn’t until 1979 that Visa and Mastercard released the magstripe exertion for accepting recognition paper payments astatine the constituent of sale.

When the net became available, Europay, Visa, and Mastercard besides developed EMV chips connected recognition cards successful 1993, importantly improving recognition paper processing. Soon after, pioneers similar PayPal, Verifone, and Ingenico developed mobile paper readers, allowing businesses to judge payments anywhere.

Eventually, PayPal transitioned distant from its basal mobile paper readers and, on with different competitors similar Square, introduced POS terminals that connection amended information and much precocious outgo capabilities. As POS exertion advanced, starring outgo processors launched what are present called “Smart Terminals” that combined precocious POS features.

How tin POS terminals amended concern operations?

The advent of the net enabled POS systems and terminals to germinate into a much businesslike concern solution. Nowadays, terminals connection quicker and much unafraid outgo processing, lawsuit engagement tools, amended inventory control, and further outgo channels.

Read more: Best POS systems for tiny business

How bash POS terminals work?

The relation of the POS terminal successful the POS ecosystem is to compute the full outgo of the transaction, judge payment, and support a grounds of the transaction.

During checkout

At checkout, customers bring products to the POS terminal for purchase. The seller scans the merchandise barcode with a barcode scanner, which generates a corresponding SKU fig wrong the POS system’s inventory catalog. The merchandise information, including the database price, is past displayed, and the idiosyncratic enters the quantity to get the full cost.

When collecting payment

Once the full terms is displayed, the lawsuit presents their preferred outgo method.

• If currency oregon different non-card payments: The seller enters the tender magnitude to punctual the currency drawer.
• If card: the seller volition either swipe, insert, oregon pat the paper successful the country wherever the paper scholar is located successful the POS terminal.
• If mobile and different integer payment: the lawsuit volition contiguous impervious of outgo connected their mobile instrumentality for the idiosyncratic to grounds the confirmation code

In the backmost end, a outgo authorization petition is initiated astatine this point. The transaction and outgo information is encrypted and transmitted by the merchant’s outgo processor, past sent to the applicable fiscal institutions for verification. If the customer’s slope confirms that funds are available, the transaction volition beryllium authorized, and outgo support volition beryllium displayed connected the POS terminal. Otherwise, a declined outgo announcement volition beryllium displayed, and the lawsuit volition beryllium asked to supply a antithetic outgo source.

Logging the transaction

Finally, a receipt for the completed transaction volition beryllium generated and provided to the customer. A transcript of the receipt is kept by the user. For paper transactions, a transaction receipt is generated successful triplicate, and 1 is fixed to the customer. At the backmost end, the POS strategy besides records the merchantability and adjusts the disposable inventory successful real-time.

Read more: POS deployment checklist

What are the cardinal features to look for successful a POS terminal?

The POS terminal is simply a operation of bundle and hardware components.

Hardware setup

Hardware is an indispensable diagnostic of a POS terminal. For it to implicit its task, the POS terminal should have, astatine minimum:

• A computer-operated instrumentality that runs the POS software.
• A paper scholar for accepting paper payments (swipe, tap, oregon dip).
• A thermal printer to make receipts, oregon different means of delivering receipts.

You whitethorn besides privation to consider:

• A barcode scanner to scan barcodes that pulls up merchandise information.
• A currency drawer (for countertop terminals) for storing currency and different non-card payments if you program to judge cash.

Payment gateway

The outgo gateway is simply a bundle constituent embedded successful the POS system. This is the checkout model connected the strategy show wherever the idiosyncratic enters the customer’s outgo information. The outgo gateway volition show the disposable outgo methods depending connected your outgo processing settings. It is besides the outgo gateway’s relation to encrypt the transaction information earlier sending it to the outgo processor for authentication.

Payment processor

The outgo processor connects to the paper web and different fiscal institutions that authorize the transportation of funds from the customer’s root to the merchant. Payment processors are integrated into the POS terminal and connection tools for processing cards, ACH, integer checks, contactless payments, and more.

Inventory management

Inventory absorption is simply a superior diagnostic of a POS strategy and cardinal to an businesslike POS terminal. The strategy instantly updates inventory levels with each transaction completed, returned, oregon refunded from the POS terminal. Constant inventory monitoring helps forestall stockouts.

Transaction reporting

One of the superior functions of a elemental currency registry is to support income records. With a modern POS system, each transaction completed successful a POS terminal not lone records the merchantability but besides generates lawsuit profiles and updates disposable inventory. It tin categorize transactions successful aggregate ways, specified arsenic by employee, checkout counter, customer, product, and more.

Loyalty and rewards

While not a cardinal component, a loyalty and rewards programme integrated into the POS strategy tin importantly amended lawsuit relationships. With this feature, a merchant tin further analyse lawsuit purchasing habits and make tailored campaigns that customers volition privation to enactment in. This helps businesses to physique a coagulated lawsuit basal and support them engaged.

Top POS terminals successful 2024

With each the POS systems and terminals connected the marketplace today, choosing the champion enactment for your concern tin beryllium challenging. Below, I springiness you our apical POS terminal recommendations for fashionable concern types:

Square Terminal

The Square Terminal is Square’s all-in-one mobile POS terminal. It comes with built-in POS bundle that tin enactment arsenic a stand-alone oregon arsenic a 2nd surface to the Square Register and a built-in paper scholar for swipe, EMV chip, and NFC contactless transactions. What’s large astir Square is that it offers industry-specific POS bundle that tin beryllium installed into the Square Terminal astatine nary other cost. Though not optimized for agelong hours of handheld outgo processing, the Square Terminal is compact capable for accepting payments table-side and for casual setup successful farmers markets and popup stores.

Square Terminal with built-in thermal printer. Image: Square

Specifications:

• Price: $299 oregon $27/mo for 12 months
• Warranty: One-year constricted warranty, 30-day escaped return
• Payments accepted: Chip cards (EMV), NFC cards, Apple Pay, Google Pay, Samsung Pay, Afterpay, Cash App Pay (QR code), Magnetic-stripe cards with escaped magstripe scholar plug-in
• Offline outgo available
• Connectivity: Wifi, Ethernet
• In the box:
  • Square Terminal hardware
  • Power adapter
  • Power adapter cable
  • Receipt insubstantial roll
• Accessories:
  • Hub for Square Terminal
  • Additional insubstantial rolls
• Hardware: White, made of metallic and molded plastic, weighs 417g, 5.6in L x 3.4in W x 2.5in H
• After-sale support: 24/7

Clover Flex

The Clover Flex is simply a sleek and portable POS terminal designed for handheld transactions. It is equipped with a 6-inch colour touchscreen and built-in camera, receipt, and barcode scanner. The Clover Flex besides has an embedded magnetic stripe, EMV chip, and NFC contactless scholar to process payments. Merchants tin acquisition this with oregon without POS software, but you’ll request the bundle if you mean to usage the Flex arsenic an hold of a countertop POS system. The Clover strategy is unsocial due to the fact that it’s compatible with a fig of outgo processors.

Clover Flex. Image: Clover

Specifications:

• Price: $599 oregon $35/month
• Warranty: One-year constricted warranty
• Payments: Accepts chip, swipe, and contactless payments similar Apple Pay®, Google Pay™, and Samsung Pay®
• Display: 6″ LCD colour interaction screen
• Camera/Scanner: 1D/2D barcode scanner/camera
• Receipt printer: Built-in thermal dot receipt printer
• Security: Clover Security end-to-end encryption
• Connectivity: Wi-Fi and LTE connectivity
• Battery life: 8 hours for modular SMB
• After-sale support: 24/7
• Purchase options:
  • Flex Pocket (without built-in receipt printer)
  • Clover POS bundle (retail oregon restaurant) astatine $14.95 oregon $49.95 per month
• In the box:
  • Clover Flex hardware
  • Charging cradle
  • Power cord
  • Power ceramic (battery)
  • Optional PIN introduction aid
  • One rotation of receipt paper
  • Quick commencement guide

Toast Go2 handheld POS

Toast’s handheld instrumentality is simply a stand-alone POS and outgo terminal with built-in POS software, a paper reader, and receipt printer. The hardware is industry-grade, with IP54 extortion against particulate and h2o damage, and built to withstand drops up to 4 feet. Ideal for engaged sit-down restaurants, the Toast Go2 comes with array seating and preservation absorption tools, positive customized tipping, measure splitting, and signature seizure features.

Toast Go2 handheld industry-grade hardware. Image: Toast

Specifications:

• Price: Startup kit $0 oregon $494.10 + $50/mo
• Warranty: One-year constricted warranty
• Payments: Accepts NFC, EMV, and accepted MSR recognition cards, Apple Pay, Google Pay, and different contactless payments
• Durability: Restaurant-grade. Dropproof up to 4 feet, IP54 rated for particulate and h2o resistance
• Display: 6.4-inch touchscreen
• Dimensions: 7.87” L x 0.79” W x 3.74″ H
• Product Weight: 1.13 lbs
• Battery life: Up to 24 hours

PayPal Terminal

The PayPal Terminal is simply a stand-alone POS hardware designed likewise to Square Terminal. However, hardware tools similar barcode scanners, thermal printers, and charging docks are optional. The PayPal Terminal comes with a built-in paper scholar susceptible of tap, EMV chip, and contactless payments and PayPal’s POS software. The starter kit besides includes a preloaded SIM paper for continued net entree and uninterrupted outgo processing. The PayPal Terminal is perfect for selling successful farmers’ markets, commercialized shows, and popup stores that cater to tourists who wage with planetary recognition cards.

PayPal Zettle Terminal comes with a magnetic dock with a built-in terminal printer. Image: PayPal

Specifications:

• Price:
  • Basic PayPal Terminal: $199
  • With barcode scanner: $239
• Accessories:
  • Printer and magnetic charging dock: Plus $70 (with basal Terminal) oregon Plus $60 (with Terminal and barcode scanner)
• Warranty: One-year constricted warranty, 30-day return
• Payments: Chip, tap, PIN, and NFC payments
• Battery life:
  • Standby – Up to 48 hours
  • Operational – Up to 12 hours
  • With Zettle Printer & Dock – constant
• Dimensions: 5.4in L x 3in W x 0.6 successful H
• Weight: 210 grams
• Connectivity: WiFi, 3G/4G
• Dark gray, made of metallic and molded plastic

Helcim Smart Terminal

The Helcim Smart Terminal comes with stand-alone POS software, a colored interaction surface display, and a built-in receipt printer. It connects to the net via WiFi and accepts paper and integer wallet payments via tap, chip, and PIN. It tin besides judge payments for Helcim invoices via manual paper entry. The instrumentality lacks a camera oregon barcode scanner, truthful it’s amended suited for nonrecreational services and restaurants than retail. But what makes Helcim Smart Terminal basal retired is its pre-approved and built-in surcharging feature, which you tin toggle connected and disconnected for each transaction.

The Helcim Smart TerminaI. Image: Helcim

Specifications:

• Price: $329 oregon $30 for 12 months
• Accessories: Charging dock $50
• Payments: Accepts chip, tap, PIN, and contactless payments similar Apple Pay®, Google Pay™
• Warranty: One-year constricted warranty, 14-day return
• Connectivity: WiFi
• Dimensions: 7.87in L x 3.07in W x 2.20in H
• Weight: 1.1 lbs
• In the box:
  • Helcim Smart Terminal
  • Charging Cable (USB-C to USB-A)
  • Additional USB-C Cable
  • Receipt insubstantial rolls x2

How bash you take the close POS terminal for your business?

The close POS terminal for your concern depends connected your needs and the operation of hardware, outgo processing, and bundle that volition champion suit you.

Unlike 10 oregon 15 years ago, erstwhile businesses had to determine whether they wanted an on-premise oregon cloud-based POS, today, astir POS systems exclusively connection unreality setups. However, see the pursuing factors erstwhile choosing a POS terminal for your business:

Available outgo methods

The champion POS terminal should enactment each large recognition cards and integer payments. It should besides beryllium capable to judge immoderate different outgo methods you privation to support, including acquisition cards, keyed-in payments, and bargain now, wage aboriginal (BNPL) installment options. The close outgo processor volition besides supply you options to usage outgo optimization programs specified arsenic surcharging and convenience fees to minimize your processing costs.

Read more: Best merchant services

Fees

Speaking of processing costs, outgo processing fees are arguably the astir important origin erstwhile choosing a POS terminal. Hardware costs for outgo processing alteration from escaped to hundreds of dollars, depending connected your concern needs. However, recurring costs for accepting payments volition impact your gross the most. Choose a supplier that volition springiness you the astir savings based connected your income volume. Make definite that you lone wage for outgo processing features that you presently need.

Security

Regardless of your concern size oregon industry, transaction information should beryllium a large information arsenic you grip delicate lawsuit information. To minimize information risks, enactment lone with level 1 Payment Card Industry (PCI) accredited outgo processors. This ensures that your supplier offers the latest information features, specified arsenic end-to-end encryption, idiosyncratic authentication, instrumentality learning fraud detection, and chargeback absorption tools.

Read more: Guide to POS security

Available integrations

Your POS terminal should person entree to cardinal functionalities specified arsenic inventory, lawsuit narration absorption (CRM), loyalty and rewards, and reporting. You should besides look for different third-party integrations for tools you whitethorn need, specified arsenic accounting and section delivery. Being capable to integrate each these features into 1 level helps successful creating an businesslike concern absorption solution.

Connectivity

A reliable POS terminal stays connected and works efficiently with minimal downtime oregon failed transaction requests. For this, you request to take a outgo terminal hardware with aggregate connectivity options specified arsenic Bluetooth, WiFI, and LAN, arsenic good arsenic impermanent offline outgo processing during a powerfulness outage. Also, see the terminal’s powerfulness root and artillery beingness against your emblematic concern time and transaction volume.

Industry-specific features

Industry-specific features besides play a relation successful outgo terminals. In fact, the aboriginal edifice POS terminals already had a room ordering integration. Currency conversion is besides 1 of the aboriginal features allowing merchants to judge planetary payments.

Look for immoderate industry-specific tools your concern needs earlier choosing a POS terminal. For example, basal and customized tipping is disposable from immoderate outgo processors. While restaurants similar section transportation functionality, a retailer mightiness request a shipping diagnostic instead.