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What Are Credit Card Readers & Their Different Types?

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Many businesses use credit card readers to carry out their regular transactions. We live in an era where plastic money is more common than real money due to various reasons. Almost all businesses accept credit card transactions and they need a solid card reader for this purpose.

It is important to know about credit card readers and how they work if you want to be able to do business properly using credit cards. Worry not, as this article is designed to help you understand just that.

Here’s everything you need to know about a credit card reader:

How Do Credit Card Readers Work?

Credit card readers read your client’s data and safely convey the information to the bank, verifies the information, and then return the result. Regardless of whether you’re accepting money with a customary electronic credit machine or a more up to date, more propelled portable credit card reader, it’s useful to comprehend the credit handling stream.

When you tap or swipe your client’s card, a money request is sent. The exchange data then goes through to the money related organization, (for example, the bank). This bank goes about as the go-between and sends the request to the organization that issued the client’s card. The issuing bank at that point checks if your client has enough credit for the exchange and uses fraud recognition programming software to check the authenticity of the exchange. If all the checks are validated, the exchange is approved.

While this sounds a little complex on paper, the whole transaction takes a few seconds to complete. However, this largely depends on the system that you use since some may be slow and come with certain limitations.

 Types of Credit Card Readers

There are various types of credit card readers available that you can browse from. The purchaser’s decision will depend on his or her needs. You need a reader that serves all the purposes. These days a lot of people use mobile phones for transactions, hence you need a device that can serve this purpose as well.

Let’s have a look at some of the most common credit card readers:

●     Credit Card Terminals

This kind of credit card reader comes with an internal modem that connects with the bank with the help of your phone line. You can use a splitter to make sure your phone line is not affected due to the credit card reader.

●     Wireless Credit Card Readers

These credit card readers are mainly made for businesses that have no time to waste and are typically used by taxi drivers or businesses that have long queues of clients. When you think of it, all clients are in a hurry and all businesses need to do the job fast, however since these readers are typically more expensive not all businesses use them.

These readers use GPRS or CDMA systems to exchange information.

●     Virtual Credit Card Readers

If you mostly use the internet or your mobile phone for financial transactions, then this is your go-to card reader. This reader can use the laptop as POS and use the software to complete a purchase. It is safe and easy to use.

Things to Consider before Purchasing a Credit Card Reader

  • It should be apprehendable to your PC through a USB or other port.
  • Should be able to download information to your PC or other electronic gadgets.
  • Should be able to read in both the directions i.e left to right and right to left. This will save a lot of time.
  • A durable keyboard with solid keypads in case your customers enter details and carry out transactions more often.
  • To read other information sources you require in your business, for example, drivers licenses, ID cards etc.
  • AC/DC fuelled and Shock Resistance.


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