Credit Card Machines 101: Understanding Payment Terminals

Whether you’re a new entrepreneur looking to set up your payment equipment for the first time, or a seasoned business owner shopping around for a new solution, having the right credit machine is critical.

Aside from actually enabling to accept credit cards, the right machine can streamline your operations, improve the customer experience, and even help grow your business.

In this post, we’ll go over the different types of credit machines in the market. You’ll gain an understanding of what each machine is about, what the costs are, and which type is best-suited for your business.

There are various types of credit card machines out there, and the “right” choice depends on the nature of your business, the processes you have, and your technology requirements, among other things.

Here’s what you need to know.


A traditional or countertop payment terminal is one of the most commonly used credit card machines today. It requires a physical connection to your phone or internet in order to process payments, and you may have guessed, a countertop terminal typically sits on a desk or countertop and doesn’t need to be moved or transported often.

Pros and cons of traditional terminals

Pro: Ability to process multiple payment types.

The biggest advantage of traditional terminals? They have the ability to process multiple payment types, including credit and debit cards and gift cards.

You can also process “card not present” transactions using countertop terminals by manually keying in the customer’s payment details.

Pro: High levels of security

Countertop credit card machines also tend to be more secure. You can easily equip them with extra equipment like PIN terminals to further prevent fraud or breaches.

Con: Limited mobility

Traditional or countertop solutions have limited mobility, so expect to be stationed in one area of your store or workspace when dealing with payments.

Con: Bulky

Countertop terminals tend to be bigger and heavier, so setting them up or moving your equipment may take time and effort.

Businesses that benefit most from countertop credit card terminals

For the reasons mentioned above, countertop machines are best-suited for businesses that have a designated area for processing transactions. These may include retail stores with a checkout counter or cash wrap, restaurants, salons, as well as medical and dental offices.

Businesses that take payments over the phone — such as B2B establishments — would also benefit from traditional credit card machines.

How much do traditional or countertop credit card machines cost?

Prices will vary depending on the machine, model, and features, but costs for traditional payment terminals can range from just under $100 to $350 and above.

Examples of traditional payment terminals

Common examples of traditional credit card machines include:

Ingenico iCT250

VeriFone VX 520

First Data FD130


Need to be on the go when processing payments? Then a mobile or wireless credit card machine would be a better option for you. Unlike the traditional types, mobile payment terminals don’t require a physical connection to your Internet or landline. Instead, they can connect wireless via WiFi or 4G.

Pros and cons of wireless terminals

Pro: Freedom and mobility

The main benefit here is obvious. Wireless terminals enable you to process payments on the go. So whether you’re operating a mobile business or you’d like to take payments from anywhere in your store, a wireless terminal will allow you to do so.

Con: *Some* security concerns

There are some security concerns, particularly around wireless connectivity, but they can be avoided by connecting to a private network and adhering to data security best practices.

Businesses that benefit most from wireless / mobile credit card terminals

Mobile or wireless credit card machines are best-suited for merchants who take payment on the move. Food trucks, as well as businesses attending events, are prime examples. These terminals are also ideal for merchants who make house calls — e.g., plumbers, on-site service providers, etc.

How much do mobile/wireless credit card machines cost?

Prices for mobile and wireless payment terminals are similar — albeit slightly higher — than traditional ones. Prices range from $100+ to $350+.

Examples of mobile/wireless payment terminals

Common examples of this type include: BBPOS Chipper

SwipeSimple B250

Dejavoo Z9

Ingenico iWL250

Verifone Vx 680

Clover Flex

Integrated Point-of-Sale

You could also process payments through your point of sale system, which usually means that your POS hardware and software are bundled together.

Pros and cons of integrated POS

Pro: Faster checkout

The process of accepting card payments is relatively more efficient if your POS is integrated with your payment processor. This is because an integrated system means that payment information smoothly flows from your processor to your point of sale software, and you don’t need to manually key in the amounts. This, in turn, reduces human error and makes tasks like transaction reconciliation much easier.

Con: Limited choices when it comes to providers

The downside is you don’t get to choose your payment processor, so your rates and the terms of your agreement will be decided by your POS. As such, if another payment processor offers a better rate, then it might be difficult (or impossible) to switch.

Businesses that benefit most from integrated POS machines

POS-integrated terminals are quite flexible, and providers often have solutions for various types of businesses. As such, companies that are happy with their point of sale solution and/or credit card processor should look into POS-integrated machines. 

If you already have a great relationship with your payment vendors, consider looking into their point of sale offerings as doing so can make your business more efficient.

How much do POS-integrated terminals cost?

These solutions are usually more expensive because you’re also paying for the POS system. Prices range from $400 to well over a thousand dollars.

Virtual terminals

Virtual Terminals are just that — virtual. They’re secure web pages that allow you to enter payment information into the application. The terminal then processes the payment electronically.

Pros and cons of virtual terminals

Pro: Ability to process card-not-present transactions

Virtual terminals come in handy because they enable card-not-present transactions. Credit card details are entered manually, so you can take payments online or over the phone.

Pro: Reduce the need for paper and additional hardware

Virtual terminals also reduce paper waste. Not to mention, the upfront costs are lower because hardware isn’t required.

Pro: Potentially lower rates for B2B

Virtual terminals are also better for B2B merchants because they can enter more information to get lower rates

Con: Inefficient for in-person payments

As for their disadvantages? Virtual terminals can be inefficient for businesses that process face-to-face transactions. For example, if a retail store is using a virtual terminal instead of a physical credit card machine, then the retailer would have to manually enter the shopper’s credit card number instead of swiping it. Additionally, virtual terminals cannot accept cash, checks, or debit cards.

Businesses that benefit most from virtual terminals

Virtual credit card machines are suited for merchants that ring up sales remotely. Online businesses, ecommerce sites, freelancers, medical billing companies, and certain B2B merchants would benefit the most from these terminals.

How much do virtual terminals cost?

Many virtual terminals charge a subscription fee or percentage rate, depending on the agreement. Do note that processing costs are typically higher for card-not-present transactions because they’re more susceptible to fraud.

Examples of virtual terminals

  • Velocity
  • USAePay
  • NMI

How to select the right credit card machine for your business

There’s no one single path towards choosing the right credit card machine. To determine the best choice, you need to factor in things like:

Your business activities and procedures

Think about how things work in your business. If you’re on the go and constantly sell on the road, for example, then a mobile or portable terminal is ideal. If you regularly have to take payments over the phone, then you’ll need a virtual terminal or a traditional machine that can support card-not-present transactions.

Your existing technology

If you have existing hardware and software in place, then you’ll need to consider those technologies when choosing a credit card machine — unless you’re willing to start from scratch.

For instance, if you’re happy with your current POS system, then be sure to ask about the credit card machines that work best with their software. Or if you already have a payment provider in mind, then inquire about the hardware that your processor can support.

Speaking of existing technologies, if you already have a payment terminal, and need to switch payment processors, you may not have to purchase new equipment. A lot of merchant services providers can reprogram your credit card machine to work with their solutions. Some payment processors — including APX — will even do it for free. So if you’re shopping for a credit card processor and you have existing terminals in place, don’t forget to ask about reprogramming.

Your location

Do you have enough space for a dedicated “payments area” or are you better off ringing up sales on the spot? Do you operate in a high-traffic location that requires more mobility? Such questions will help you decide whether you need a mobile credit card machine, a  desktop terminal, or even a POS-integrated one.

The payment types you need to accept

While all credit card machines can accept… well, credit cards, not all terminals can process multiple payment types. For example, virtual terminals cannot take cash and debit cards. Need to process EMV cards or mobile wallets? Then choose a credit card machine that has those capabilities.

Your budget

Credit card terminals come in various price points, and you want to make sure that you choose a device that fits your budget. One key piece of advice when it comes to budgeting for your credit card machine is to stay away from leasing! Leasing your terminals can cost $30 to $100 a month over 2 to 4 years, which adds up to thousands of dollars over time. As we pointed out earlier in the post, credit card machines cost a fraction of that (a few hundred dollars for the most part). 

As such, when you lease your payment terminals you’re essentially paying thousands of dollars for a device that’s worth a few hundred (and you don’t even get to keep the machine).

What should you do instead? If you’re unable to purchase a credit card machine upfront, consider short-term rentals instead of leasing. But make sure you save up enough money for a new terminal ASAP to avoid shelling out unnecessary costs. And if you already have credit card terminals, see if you can reprogram them to avoid buying new ones.

Final words

These days, the ability to accept credit cards is no longer “nice to have” — it’s practically table stakes in just about every business sector. That’s why it’s essential that you arm your business with a terminal or machine that allows you to ring up sales efficiently and provide the best customer experience possible.

Good luck and we hope you find the right credit card machine for your business. If you need more insights into credit card machines and payments, feel free to get in touch!

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