If you had doubts about the ubiquity of card transactions, card payments now exceed $6.5 trillion annually in the U.S. For a small business, it just makes sense to accept card payments. Not doing so can create a barrier between you and your customers’ business, which is why having an up to date point of sale device, such as the Poynt Smart Terminal, is increasingly essential. While credit cards account for the majority of card purchases made each year, other card purchases still account for a lot. Some of the unsung heroes are debit cards, prepaid cards, and gift cards. Here we’ll discuss them and their differences.
Debit cards are linked directly to your bank account. They allow you to make purchases that can’t exceed what you have in your account, aside from what may be covered with overdraft protection. Accepting a debit card involves a customer dipping, swiping, or tapping a debit card before inputting their PIN. Most debit cards can be used anywhere normal credit cards are accepted. Debit cards, like credit cards, are subject to PCI compliance guidelines because of the sensitive information they carry.
Prepaid cards are cards that are loaded with funds in advance. They allow you to pre-pay for purchases, then use the card and withdraw deposited funds from it. Prepaid cards will not allow you to make purchases that exceed the amount on the card, because that is all that has been loaded on them. These cards are often accepted in most places debit and normal credit cards are. Prepaid cards, though they run the risk of being stolen, do not contain any sensitive information, making them less of a risk if a breach occurs.
Gift cards are similar to prepaid cards. They are loaded with funds in advance, and purchases cannot exceed the amount on the card. Unlike prepaid cards, gift cards typically can’t be loaded more than once. They are also not nearly as widely accepted as credit, debit, or prepaid cards. In addition, gift cards often have expiration dates, and unlike other forms of plastic, they can’t have their funds carried over to a new card. Gift cards don’t usually have to follow PCI compliance guidelines either.
While there are some differences to all these types of cards, there is one similarity-they can help your business make money. Because of that, it pays to be able to accept all of these cards, and an even greater variety of payment types. At Moolah, we provide our customers with a free Poynt Smart Terminal, a POS that accepts a wide variety of payment types. The Poynt Smart Terminal accepts credit cards, debit cards, prepaid cards, and gift cards alike. It even accepts NFC touchless payments. If you want to do the most for your business, consider Poynt POS & Moolah for your payment processing needs.