POS Terminology

The following are important terms to become familiar with before seeking to purchase a POS system:

Card Reader: A card reader allows the POS system to accept credit cards, eliminating the need for a separate credit card terminal.

Cash Drawer: Stores cash payments of customers.  Usually connected to the POS terminal.

Central Control Unit: The main computer to which all POS terminals are linked. 

Check reader: Similar to a card reader, a check reader scans a customer’s check and verifies available funds.  Check readers can be linked to a merchant service, and have the capability to convert a check into a debit transaction, allowing for quicker receipt of funds. 

Check conversion service:  A merchant service provided by banks that allows processing checks as a debit transaction.  A check reader is required to scan and verify checks.

Credit card terminal: A device that performs credit card processing functions, such as accepting payments.

Customer display: Also called a customer pole display, this is a screen that displays information such as total price for a customer at a POS terminal.

Hardware: Physical components of a POS system, such as a credit card machine for credit card processing.

Keyboard: A component of a POS terminal.  Information can be input using a traditional keyboard or a customized one, depending on the business.

Scanner: A device used to “scan” barcodes on products.  Scanners allow employees to input product information more quickly and accurately than some other methods.

Signature capture device: A component of a credit card terminal used to capture and record the electronic signature of a customer who has paid by credit card.  Avoids the need to keep and store signed paper receipts.

Software: The program components of a POS system.  Software is often industry-specific or customized to the needs of an individual business owner. 

Terminal: A “station” where sales information is input, such as a cash register.

Touch Screen: A screen on a POS terminal that allows the user or employee to easily specify the items a customer is purchasing.  Touch screens are easy to use and better suited for some industries that cannot “scan” products, such as restaurants or bars.