The move towards a cashless society is gathering pace.
Not so long ago, card payments were the realm of big business only. Now businesses of all sizes must offer this service, or just like cash, they will be confined to history.
This is not scaremongering, the use of cash has fallen dramatically in just the past couple of years, with the pandemic acting as a catalyst to drive the acceleration.
According to the Bank of England, in October 2020, the UK saw a decrease of 40% in cash withdrawals from ATMs as compared to the previous year. The use of cash will undoubtedly recover somewhat with the easing of the pandemic, but the trend is only going to go one way.
For cash, the death knell has been sounded.
Many small businesses have survived and indeed thrived, operating on a cash-only basis for years. However, this is no longer the case, now businesses of all sizes must offer cashless payment options if they want to keep trading.
But here’s the good news. There are a huge number of benefits to offering cashless payment options, and these days it is simple to get a system up and running.
This guide details everything a small business needs to know about the types of card terminals available and which is the best for your type of business.
What is a card terminal?
This may seem like an obvious question, and in a way, it is. We have all seen and used card terminals on an almost daily basis. But for the purposes of this guide, it is useful to get a handle on the different kinds of card terminals available for the small business and how the process of accepting electronic payments works.
When it comes to choosing the right cash machine terminal, it is important to understand how most of your payments will be taken. Examples of the considerations a small business needs to take would be:
- Do you have a single point of sale, e.g., a cash register?
- Does the customer often pay at a table or other location? (restaurants, coffee shops, etc.)
- Is your business mobile and accepts payments from locations other than its base?
The type of terminal or terminals that are suited to business is largely dependent on the answers to these questions. Bearing that in mind, let’s have a look at the most common types of card terminals for small businesses.
Countertop card terminals
For businesses that normally take payments using a fixed location like a cash register, then countertop card machines are a simple option that can accept contactless and chip and PIN payments.
Retail outlets from corner shops to supermarkets will mostly use this type of terminal, and these are the types of machines we are most familiar with. These types of terminals can handle most types of cashless payment, including credit and debit cards and digital methods like Google and Apple’s payment apps.
Advantages of Countertop Card Terminals
- Simple to use
- No connection issues
- No need to charge
Disadvantages of Countertop Card Terminals
- No portability
Portable card terminals
These are similar to the countertop version; however, to coin a phrase, they bring an element of portability to the table.
This portability makes them an ideal choice for environments like restaurants and cafes or anywhere else where the customer is likely to pay at locations other than the cash register.
The portable functionality adds an element of convenience for both customers and staff by cutting out the need for multiple trips to the card terminal and back. It also offers the customer more reassurance as their card is never out of sight.
For the business, it also allows the use of multiple card terminals.
Regardless of how many terminals are used, the mechanics behind portable card terminals are the same. The terminals all use a wireless connection, generally Bluetooth, to connect to their base. They have a range of about 55 metres in ideal conditions, but where there are multiple walls or partitions, this will be reduced, businesses thinking about this option will need to take this into account.
Although they do need to be charged, one charge will last for up to 500 transactions and most come with a charging base, so they are easily charged when not in use.
As with countertop terminals, these can take all common payment methods, including digital payments and credit and debit cards.
Advantages of Portable Card Terminals
- Multi-terminals can be used
- Reassuring for customers
Disadvantages of Portable Card Terminals
- They need to be charged
Mobile Card Terminals
Portability is a great choice if a business operates from set premises.
However, for mobile businesses like tradesmen, burger vans, event hosting, mobile hairdressers, or you need a solution to take with you to trade shows and conferences, then a Mobile card terminal is the solution.
Traditional businesses like tradesmen and mobile hairdressers are where the biggest growth is expected to be seen for these devices.
Much of this is down to the move away from cash. Fewer people have cash about their person nowadays, even at home, and this means that when it comes time to settle up, businesses that can’t accept card payments are left in an awkward, and these days embarrassing, position.
Most mobile card terminals use a roaming SIM card to operate and will automatically scan for the strongest signal; this enables them to work in any area that has a mobile signal, regardless of the network.
These are easy to use, simple to set up, convenient for the customer and the business, and add an element of professionalism to the appearance of the business. And as with all the types of terminals covered, these take all common types of payments, including PIN, contactless, and apps like Google, Apple, or Samsung Pay.
Advantages of Mobile Card Terminals
- Easy to set up and use
- Perfect for mobile businesses
- Collect more payments instantly
Disadvantages of Mobile Card Terminals
- Need to be charged
- Require a mobile signal
How secure are card terminals?
Regardless of the type of terminal, security is one area that worries many small businesses looking to make the move to card payments.
Some consumers and businesses have been wary of the advent of contactless payments. This is undoubtedly the biggest risk facing the consumer, but the sheer convenience of the payment process and the security measures supplied by card issuers, and the audit trail that means every payment can be accounted for does much to negate this.
On the whole, contactless and card payments are much safer than cash payments which have the inherent risk of fraud, counterfeit and of course, it leaves a business open to the potential risks of robbery and theft.
The payment is also confirmed at the point of sale, so the business will know straight away if the payment has gone through or not.
A further security concern for both parties involved in any transaction is the integrity of the data being transmitted. High-level data encryption is used in all data transmission to ensure that the information is always completely secure.
Biometrics add another layer of security for the customer when they are using services like Apple Pay, this ensures that the payment is always correctly authorised.
Finally, contactless terminals will periodically require a PIN to be input when making a contactless payment.
The benefits of card terminals for small businesses
Many of the benefits of using card terminals have already been touched on, this section describes the benefits of card terminals for small businesses in greater detail.
- Generate more business
For small business owners, this has to be the ultimate carrot. Accepting card payments can generate more business in several ways. The first is most obvious – A card terminal means that you can offer your products and services to the growing number of people that have switched completely or partially from cash.
However, it is also a fact that people tend to “impulse buy” more with a card. Without the limit of the amount of cash in a purse or wallet, there is more inclination on the customer’s part to purchase a little extra when they visit your business.
Advertising that you accept card and contactless payments can also attract more custom through businesses doors.
- Speed and convenience
The simplicity of contactless payments means that most transactions can be concluded within a few seconds. This both speeds things up at busy checkouts, but it also cuts down the need to carry large cash floats full of change.
- Better insights and analytics
Most card readers come with a variety of analytic tools that give you instant access to sales figures, stock inventory, average sale price, popular and not so popular sales items, and much more.
Having this level of information at your fingertips helps to make more informed business decisions.
- Safer for staff and customers
The pandemic has shown just how vulnerable humanity is to the rapid spread of disease. This has added some fuel to the move away from cash, and even with the pandemic easing, the need for greater precautions will always be ingrained in society.
In this sense, card terminals provide a safer way to conclude transactions, but they also reduce the risk of robbery and theft by removing the need to handle, store, and transport large amounts of cash.
What are the costs of a card terminal?
The costs of a card machine vary from company to company, so it is always best to shop around to find the package that suits your business best.
It is always best to do some research before taking the plunge. There is a massive variety of packages available when it comes to choosing the right card terminals.
A few years ago, a card terminal may have been seen as somewhat of an unnecessary luxury for a small business. But trading conditions have changed and will remain changed forever.
Now the luxury of taking card payments has become a necessity.
However, this shouldn’t be seen as an added hassle for business owners. Card terminals provide an opportunity to generate extra business, add a layer of professionalism, and protect staff and customers.
The simplicity of setting a card payment system up is also far easier than it was in the past, and the variety of terminals to choose from means that there is an option to suit every type and size of business.