The Pros and Cons of Mobile Phone Based POS Terminals | MONEXgroup
 
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   Mobile Phone and Wireless POS Terminals

    
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     What Mobile Phone POS Terminals Mean for Small Merchants     


With the constant pressure on retailers and restaurants to provide faster service, the appeal of wireless credit card POS terminals that let merchants process payment from anywhere is obvious. Wireless credit card terminals come in a variety of formats, each with its own set of benefits and risks.

Whether in the restaurant business, making use of non-traditional storefront design that optimizes mobile POS technology, or making sales at conventions or other temporary sales locations where permanent credit card readers are not possible, a wireless POS terminal is more than sufficient. However, some small merchants have opted to take advantage of a very new mobile credit card payment processing technology, mobile phone credit card swipers. Marketed under various names and available for most mobile phones, most popularly the Apple iPhone, this technology, which includes a piece of hardware to read the credit card and software to process the payment through the phone, is relatively inexpensive and available to anyone with a compatible payment processing service.

There are several advantages to this type of payment processing compared to standard wireless POS terminals, but it also carries its own risks. One of the biggest advantages is that acquiring the technology is much less expensive than with standard POS machines, and monthly fees are far lower. This puts accepting credit card payments within reach of even very small merchants, such as part-time handymen, street-card food venders, or private tutors. But bigger players also stand to gain flexibility, efficiency, and lower-costs from this tech, such as airlines for on-flight sales, and restaurants in shopping mall food courts.

However, this new take on POS terminals is not risk-free. For one thing, many consumers are naturally weary of inputting their credit card info into anyone else’s cellular phone. And the same things that make it attractive also contribute to the risks. If the phone with the credit card terminal is lost or stolen, anyone who understands the technology can use it to make fraudulent charges. What’s more, though the price is falling, the fee per charge with this technology is higher than the same transaction with a standard credit card POS. The advent of totally mobile credit card processing via smart phones offers both significant benefits and very real drawbacks from merchants.

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