Merchant services: Are PDQ terminals created equal?

Every retailer now needs to process electronic card payments - and with the introduction of contactless payments, even the bakery down the street or any other business routinely managing petty cash payments now have every reason to accept credit card, too.

Which means every business needs a PDQ machine and terminal. What are the main features and manufacturers of PDQ terminals? How does the introduction of credit card processing equipment adapted to tablets change the market landscape?

Key Features

1) Basic Features of a PDQ terminal and accepted cards

PDQ machines basically read the customer’s card information, retrieve solvency information from the credit or debit card issuer’s servers, accept payment and print an invoice. All this can be done with a single terminal, or through as many peripherals as needed (card reader, keypad, printer). The level of integration will depend on how mobile the system needs to be:

• Static or countertop systems are located at till points, and the till is in turn connected to a phone line.

• Portable terminals allow credit card processing with a certain distance (about 100 meters) from the base, witch which it is usually connected through Bluetooth.

• Mobile systems are directly connected to a cellular network, and can process payments anywhere a mobile signal can be reached.

Depending on hardware, but also on software and contract options, PDQ machines will accept the following credit and/or debit cards:

• Most machines will be EMV (Europay, Mastercard and VISA) approved, so they can work with these credit card issuers,

• Diners Club International, American Express, Discover will usually be optional,

• Contactless debit or credit card will require compatible equipment.

2) ePos Integration

A PDQ terminal is an important part of an electronic point of sale, and when properly integrated, will bring many benefits to the business:

• Full integration means employees do not need to put a transaction through the POS system but only through the terminal, which reduces the opportunity for errors.

• An integrated system will cut average transaction times to less than 5 seconds.

• Direct transaction data reporting into the accounting software will allow instant reconciliation of payment data, regardless of the means of payment used.

Major manufacturers

There’s only a handful of PDQ terminal manufacturers globally.

1) VeriFone

Verifone used to be the most popular card processing solution vendor, and is still a global leader. Their models includ the Vx520 (countertop) and Vx680 (mobile).

2) First Data

The main competitor to Verifone is First Data, with about 6 million equipped merchants, mostly in the US. Their main products are the FD100 (countertop), FD 200 (portable) and FD400 3G (mobile).

3) Ingenico

Closing the top-3 list is Ingenico, a French company with a strong European footprint. Their most popular models include the iCT250 (countertop), iWL252 (portable) and iWL251 (mobile).

4) Dejavoo

Dejavoo is a new player specializing in wireless products, with their M line, V5, V8, V9 series.

Card reading extensions for tablet terminals

The new opportunity to process credit and debit card directly from a tablet or smartphone, only with ad-hoc software and a card-reading dongle may be the most disruptive innovation in the card payment industry.

1) Current existing solutions

Current solutions include pure players as well as systems developed by major traditional banks. The most popular providers are the following:

• Payleven has a PDQ terminal that works on both Apple and Android systems,

• PayPal offers PayPal, which now accepts NFC protocols,

• Bluepay also provides Android-compatible card readers,

• BarclayCard Anywhere is a solution offered by the popular bank which includes a card terminal that can be connected to a smartphone.

2) A real game changer?

These new solutions have the benefit of not tying the business customer to a specialized hardware vendor, and sometimes even to a bank. Familiar b2c equipment can be used in a fully mobile environment. However:

• Some systems do not include chip card readers, and only work with swipe cards;

• Payment schemes greatly differ, with varying commission rates. Hardware may be rented for a fee, for free with a deposit, or just sold.