When choosing tools to support your payment acceptance strategy, the types of credit card machines and terminals you outfit your business with matter. Not all devices take contactless payments or work with existing systems. Some have built-in receipt printers, whereas others email or text billing statements.
Understanding the differences between payment devices helps your business get the most out of its budget. Discover your options and learn how to choose the best credit card processing machines for small businesses.
What are credit card machines and terminals?
Credit card machines and terminals are payment processing hardware for accepting electronic payments, like credit and debit cards. Their main purpose is to capture card information and authenticate the payment method before sending the data to the processor. The equipment will decline nonworking or expired cards.
Credit card machines include the following features:
- A PIN pad: Customers enter their PIN on the keypad and authorize the payment.
- A screen: The display shows the transaction total and notifies the customer or staff when the payment is approved or declined.
- A card reader: This component reads the card data based on the type of credit card (Europay, Mastercard, and Visa [EMV] chip or traditional magnetic swipe).
- A network connection: Card terminals access the internet to send data to the processor to begin the authorization process.
- A printer: Many, though not all, portable credit card terminals have built-in receipt printers, and others connect to external devices.
Credit card processing hardware offers several other features besides the above components. Hand-held units often have built-in barcode scanners and one or two cameras. Tablet-style models provide touchscreens, and the equipment may integrate with various accessories and add-ons.
How do credit card processing machines work?
Credit card processing devices collect cardholder data from the magnetic stripe or EMV chip when a customer swipes or inserts their card. Then, the card readers, point-of-sale (POS) terminals, or credit card machines transfer the information to the payment service provider (PSP) over a wired, Bluetooth, or wireless network connection.
Once the authorization process is finalized, the credit card processor forwards the approval or denial code (which comes from the cardholder’s financial institution). Within seconds, your customer's transaction is complete. A statement prints automatically from a built-in or stand-alone receipt printer, or you may have the option to email or text the receipt to customers.
Types of credit card machines and payment terminals
Most credit card processing providers and equipment brands offer several types of business credit card machines, readers, and terminals. The options differ in price, processing speed, and portability. While the cheapest versions provide a keypad and a few additional features, more expensive hardware includes full POS functionality.
Stand-alone credit card terminals
If you have ever paid with a credit card at a checkout counter, you have most likely encountered this traditional device. Countertop payment terminals accept credit and debit card payments; some are set up for EBT, or electronic benefits transfer, transactions. These units typically connect to POS software. Although slight differences exist between brands, the basic features remain the same.
- Best for: face-to-face transactions at brick-and-mortar businesses and taking payments over the phone.
- Functionality: Devices have an EMV chip reader, a magnetic stripe reader, a keypad, and a small screen. Newer hardware also supports near-field communication (NFC), which allows customers to tap to pay for contactless transactions.
- Pricing: $100 to over $300.
- Network connection: hard-wired phone or Ethernet.
Wireless credit card machines
Hand-held credit card terminals come in two varieties. One version is a portable card reader similar to a basic countertop machine. It's durable and built to accept payments curbside or at the table. A smart terminal or mobile POS system is the other option. Entrepreneurs can manage inventory and customer profiles from the portable tablet or phone-sized unit.
- Best for: businesses wanting the flexibility to process payments indoors or out, or that prefer a smaller POS unit.
- Functionality: Most devices support chip, swipe, and contactless payments. The terminals have a screen and keypad or touchscreen; some offer printers, barcode scanners, cameras, and POS software.
- Pricing: $199 to $599.
- Network connection: Bluetooth, Wi-Fi, wireless cellular, or wired Ethernet.
POS terminals with built-in card readers
All-in-one POS systems provide the complete package: software, hardware, and payment processing. They offer one or two displays and industry-specific features, like restaurant floor plan management and ingredient tracking. Most also sync with accessories, from self-service kiosks to barcode scanners.
- Best for: retailers and restaurants with medium to high sales volumes.
- Functionality: POS machines accept most payment methods and have touchscreens, POS software, and built-in or integrated printers, cameras, and cash drawers.
- Pricing: $700 to over $2,000.
- Network connection: wired Ethernet, Wi-Fi, or Bluetooth.
When looking for the best credit card machine for your small business, consider offers from payment processors or terminals that can be reprogrammed if you switch services.
Mobile credit card readers
Mobile card readers are small devices that attach to smartphones or tablets through an audio jack, Lightning connection, or Bluetooth. Most vendors that support mobile readers provide payment apps. You can use the mobile app or a virtual terminal to process payments without the card reader, but swiping, tapping, or inserting cards reduces credit card processing fees.
- Best for: service providers, market vendors, freelancers, and consultants.
- Functionality: The devices have a magnetic stripe reader, and advanced models include EMV chip readers and NFC/contactless payments.
- Pricing: Free to $125.
- Network connection: wireless cellular or Wi-Fi.
Popular payment terminals and card machine options
The different types of credit card machines are designed to accommodate startups, growing businesses, and high-volume sellers. Well-known equipment brands offer universal credit card machines. These solutions work with multiple payment processors, so merchants can switch providers without buying new hardware. In some cases, merchant account providers reprogram existing credit card terminals.
However, not all third-party devices integrate with POS systems. Modern POS vendors often sell proprietary hardware designed to provide excellent payment experiences. Aside from Clover, the terminal brands below are compatible with many credit card processors, including Helcim and Stax.
Here are some standard payment processing hardware solutions:
- Dejavoo: This fintech company offers nearly every kind of device, including several surcharging-compliant options. Many merchant account services sell Dejavoo models.
- Verifone: This payment solution provider supplies mobile and countertop units for small businesses and multilane retailers. The devices work with several processing services.
- Pax: This vendor manufactures payment terminals and POS products known for their reliability, which is why they're a popular option with processing plans.
- Ingenico: This merchant services technology company provides processor-agnostic payment hardware for in-store and mobile sales.
- SwipeSimple: CardFlight designs SwipeSimple card readers, smart terminals, and POS systems, which are resold by multiple PSPs.
- Clover: This Fiserv company provides payment processing and hardware. Although many card processors resell Clover systems, the terminals generally can’t be reprogrammed to work with a different processor.
How to choose a credit card machine or terminal
Select a payment processor and/or POS vendor before choosing a credit card machine or terminal. Once that decision is locked down, look for compatible hardware that matches your sales volume and channels. Knowing your company's current state and direction can help you plan accordingly. The right payment terminal is one slice of a larger strategy toward better customer experiences and increased sales.
Consider the following factors when choosing the best credit card machine for your small business:
- The business model: Your company's way of earning money and delivering value to customers impacts your choice. A single-location, self-service buffet may prefer countertop units, whereas a diner with delivery needs mobile options.
- Credit card machines vs. POS terminals: Decide whether you want a device that only accepts payments or a system with nonpayment functions, like sales reporting and inventory management. You can choose separate but compatible devices or use only one or the other.
- Processing volume and frequency: Credit card terminals have different processing speeds based on product specifications and network connections. Ensure your equipment meets your traffic volume.
- Portability: If you need flexibility to move your hardware between locations, consider your network connection options, battery life, and the location of electrical outlets.
- Offline modes: In rural areas with less stable internet connections, or to ensure operation during weather-related outages, consider models that store card data when the terminal is offline.
- Ease of use: Look for hardware that anyone in your company can use with minimal training, and always test it out from the customer's point of view.
- Security: Major brands sell Payment Card Industry (PCI)-compliant terminals with advanced features to protect businesses and consumers. Always review security information before purchasing a credit card machine.
Once you have a few payment processors or equipment brands in mind, compare specifications and costs. Many types of credit card machines look appealing by themselves but aren’t a good fit for your existing software or sales channels.
How to compare terminal costs, payment methods, and POS compatibility
Compare credit card machines and payment processing services based on your current and near-future needs. You can take some hardware with you to a new processor, while other devices only work with one vendor.
If you anticipate accepting payments in new sales channels or locations, make sure the provider you choose scales with you, or look at terminals that can be reprogrammed. Learn how to evaluate your options and ensure they align with your long-term payment processing best practices.
POS compatibility
In addition to working with your credit card processing company, payment terminals should integrate with existing POS systems and printers. With direct integrations, staff can complete a sale at the POS terminal, and the purchase amount is transferred automatically to the payment machine. This reduces manual data entry and the errors that often come with it.
Occasionally, vendors only support certain models from a brand. And if you use proprietary software like Square or PayPal, you may need to purchase credit card terminals from them. Talk to your payment processor and review hardware specifications to verify compatibility.
For pop-up merchants or occasional sellers, robust POS integrations may not be necessary. In these cases, you are looking for durable hardware. As your business grows, you can incorporate software by comparing compatible solutions for your credit card machine.
Payment terminal costs
Weigh the benefits of functionality and reliability against the price of hardware to find the right fit for your company. However, you must look beyond the one-time cost of a credit card machine to understand long-term expenses. Buying hardware that works only with one processor or POS system limits your flexibility to shop around for better processing rates, fraud prevention features, or digital tools.
If you plan to increase your processing volume or expand to new locations, compare future costs. Also, consider how long the payment terminals will last. Equipping delivery drivers with less expensive hardware could increase your repair or replacement costs.
Payment methods
Modern credit card machines process major credit and debit cards. Most capture NFC payments via contactless cards and mobile wallets. However, this processing option must be included in your processor’s plan. In addition to standard payment methods, you may want convenient tools for surcharging programs, check acceptance, or gift cards.
Here’s what to look for:
- Surcharging capabilities: Some payment terminals have built-in features for surcharging or cash discount programs. These tools simplify compliance and enhance customer experiences. Supported models display cash prices and apply surcharges only to credit card payments.
- Electronic check processing: If customers still pay by check, consider hardware that supports TeleCheck electronic check acceptance. This feature instantly authorizes funds, reducing the risk of bad-check write-offs.
- Gift cards: Some credit card machines can be programmed to accept merchant-specific gift cards. This tool helps cashiers accept payments faster. However, processors may charge additional fees for integrated gift card programs.
- Integrated crypto software: If your customers want to pay in crypto, look for processors like Stripe that support it. While you may not be able to use physical hardware for these purchases, using a single provider for multiple payment methods lets you view all transaction types in a single dashboard.
Hidden fees, contract terms, and support issues to check before you buy
Post-purchase problems and surprises can increase costs and affect sales. The biggest red flag is often the promise of “free hardware,” which may lock you into long-term contracts with high termination fees. But other issues don’t crop up until long after you’ve signed on the dotted line.
Choose the right payment tools for your business by reviewing the fine print, checking customer reviews, and engaging with the vendor through support channels.
Here’s what to look for before buying credit card machines and terminals:
- Buy vs. leasing payment hardware: Many vendors try to talk small business owners into leasing and may even offer lower processing rates. Most experts call leases risky because they’re more expensive and leave you vulnerable to aggressive collection agencies if you close your business, switch processors, or damage the unit.
- Onboarding and setup: Setting up and integrating a payment terminal can be more challenging than you expected. Find out if the vendor provides technical support and test the customer service channels before moving forward.
- Free devices that end up costing a lot: If you're getting a machine as part of a merchant account agreement, read the contract terms to see your responsibilities if it breaks or you cancel early. The fine print may require a lengthy contract and include a steep early termination fee.
- Limited fraud or PCI compliance tools: The best processors provide robust support for managing chargebacks and fraudulent returns. Request a sample merchant statement and a demo account so you can browse options for securing your payment system.
Top vendors: Best credit card machines and terminals for small business use cases
When looking for the best credit card machine for your small business, consider offers from payment processors or terminals that can be reprogrammed if you switch services. Many vendors have solutions for multichannel sales, including e-commerce platforms, mobile terminals, and invoicing tools. Here are a few top vendors with processing hardware geared to your industry and business model.
Helcim: Best smart terminal for service professionals
Accept payments in the field with Helcim’s smart terminal. It features a bigger screen and all-day battery life, ideal for updating customer contact details, checking inventory, or creating invoices. The device supports Helcim’s fee-saver feature, allowing you to pass processing fees on to your customers. Use the built-in POS software or integrate the smart terminal with your system via APIs.
Square: Best credit card machines for new salon owners
Square’s low-cost countertop and hand-held payment hardware help startups process transactions without losing their focus. Manage bookings and deposits from the lightweight POS terminal or snap a photo of your client’s new style without switching devices. With multiple options at affordable rates, you can choose the tools that best fit your workflow.
Merchant One: Best card readers for integrating with your current setup
Start accepting credit cards at your business without switching to a new POS system or upgrading all devices. Merchant One offers handheld and countertop devices from well-known brands, including Pax and Verifone. You can enter transactions manually or integrate the hardware with your current setup.
Clover: Best payment hardware for retailers
Add Clover’s compact payment terminal to your retail shop to accept PayPal, Venmo, mobile wallets, cash, and checks. The small countertop device features a color screen and a built-in receipt printer. As foot traffic increases, choose mobile devices or kiosks to move customers through checkout lines faster.
Toast: Best credit card terminal for selling food anywhere
Use Toast’s ultradurable hand-held terminal to run credit cards in your food truck, at private parties, or curbside. The battery life handles long shifts while the device keeps working, even after drinks get spilled. There are no monthly fees with the starter kit, which comes with order management tools, digital menus, and basic scheduling features.
CO— aims to bring you inspiration from leading respected experts. However, before making any business decision, you should consult a professional who can advise you based on your individual situation.
CO—is committed to helping you start, run and grow your small business. Learn more about the benefits of small business membership in the U.S. Chamber of Commerce, here.
