What Is a Pinpad? How Can I Accept Apple Pay?

Pinpads are electronic devices used in a debit or credit based transaction. Many people no longer carry cash with them, so they are critical to a business’s POS system. Pinpads have hardware and software security features that ensure that security keys and PIN numbers are erased immediately in the event of someone tampering with the device. There are also standards required by the payment card industry that pinpads must meet to ensure adequate security. And, as you can read below, pinpads are required to accept Apple Pay.

Can I accept debit cards without a pinpad?

There is a common misconception that if a customer doesn't have pinpads, some customers won't be able to pay them. This is simply untrue. There are very few debit cards that are issued without a visa or a mastercard logo. The Visa Mastercard logo will allow the merchant to run the transaction as a credit card rather than a debit card

So why do I need a pinpad?

Fees. Or a reduction of fees. Although there's no hard and fast rule because processing fees are always dependent on your actual merchant services provider, debit transactions are often less expensive than credit transactions. Debit transactions typically charge a flat fee while credit transactions fees are based on the total transaction amount. Because of this flat verse variable cost structure, a breakeven point exists. For small transactions, debit can actually be more expensive than credit. A good rule of thumb is that a $20 transaction is about the breakeven point.

So should I get a pinpad?

It depends. Is the average transaction at your business greater or less than $20?

What type of pinpads exist?

The most basic pinpad does not include a credit card swipe and only allows for PIN entry.

Signature capture pinpads allow customers to swipe credit cards on the pinpad as well as sign their name electronically (think about the pinpads at your local grocery store). Signed receipts can help prevent chargebacks. These pinpads can also project advertisements or videos on their digital screens when not being used.

What about EMV, NFC, and Apple Pay?

Regardless of the technology, most new and developing payment technologies require pinpads.

Can I use any pinpad with my POS system?

No. First, pinpads must be encrypted with the merchant's payment processor. You simply can't pick any pinpad and expect it to work. Further, different pinpads are designed for different software programs. That's why it's always helpful to speak with a POS specialist before purchasing your pinpad.