Tuesday, June 5, 2012

How to Take Credit Cards when the POS Terminal Is Down

How to Take Credit Cards when the POS Terminal Is DownI'm sure it has happened to you: you've tried to check out from a grocery store or Starbucks or whatever and the POS terminal simply would not read your card. I'm sure that one way or another you have been able to complete the transaction and have forgotten about it by now. But I can guarantee you that, if you have been on the other side of the cash register, you would've had a much tougher time forgetting it.

In this article I will examine the issues that may prevent terminals from reading cards and will suggest a list of procedures on how to take credit cards or substitute them with other forms of payment in such situations.

Issues Preventing Terminals from Reading Cards

The major reasons that could prevent cards from being read include:
  • The equipment at the check-out is not working properly.
  • The consumer is not swiping her card correctly.
  • The card itself is damaged in some way, most likely the magnetic stripe is demagnetized. Be advised that such issues may happen by chance, but they can also be caused by a fraudulent alteration of the card.

What to Do When the Card Cannot Be Read?

Following is a step-by-step guide on what you should do when your equipment cannot read a card:
  • First of all, to isolate the problem, inspect the equipment to verify if it is functioning adequately and ensure that the consumer is swiping the card correctly.
  • If the equipment is working properly and the card is swiped the right way, look at the card itself to verify that it is not damaged or tampered with in some way.
  • If the reading issue is caused by a problem with the card itself, you have several alternatives on how to handle the situation and you will need to create a set of procedures to be followed each time such a situation arises at the check-out. For instance, you may want to ask the consumer for another method of payment (e.g. check, cash, another card, etc.). Another alternative is to override the swiping procedure and key-enter the payment information instead. Yet another option is to obtain a voice authorization approval from your merchant account provider.
  • If you decide to manually enter the payment information or to ask for a voice authorization, Visa and MasterCard rules require you to take an imprint of the front of the card. The imprint's image needs to be placed on the original credit card transaction receipt or you can print out a separate one and have it signed by the cardholder. This is important, because it gives you re-presentment rights in case of a chargeback.
Finally, you should know that key-entered payments carry higher processing fees..

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