POS Terminals To Take Prepaid Wireless Payments

POS terminals are the classic or original point of sale terminals that are used to activate POSA (Point of Sale Activated) cards, and to retrieve and print PINs on receipts.  The easiest way to think of these is that they are the POS Terminalsmall physical terminals on the counter that you see clerks using to process credit and debit card payments (see the picture!).  When prepaid wireless (and other prepaid programs like long distance and stored value cards) were first launched, these credit card terminals were upgraded to enable prepaid wireless card activation and PIN dispense functionality.

Some benefits of POS Terminals include:
  • They're easy to use - "always on" quick navigation
  • Are typically already in use in stores for taking credit and debit card payments, so clerks are already familiar with their general operation, and don't need to purchase (or lease) new hardware
  • Clerks use logins that allow managers to track and report on sales
  • Are inexpensive to purchase or lease if needed
  • Are durable
  • They're small, so require little counter space (many stores will have multiple terminals to support different products)
  • They can support multiple wireless carrier and other prepaid products on the same terminal
So how do POS Terminals work?               

1.    For Card Activations
  • After handing the prepaid topup card to the store clerk, they will usually ask you for payment first.  
  • Then they'll use the menu on the POS terminal to select the product (i.e. wireless carrier).
  • The terminal will prompt them to swipe the prepaid wireless topup card.
  • The swiping process basically transmits the card serial number to the correct technology provider, requesting that the card be activated (i.e. turning the card from cold to hot = from inactive to active).
  • The technology provider has a database that tells them which PIN is printed under the scratch-off on that card.
  • Knowing the PIN, the technology provider requests that the wireless provider (with whom they're connected) activate the PIN in real time.
  • Now if you scratch the back of the card and try adding the PIN to your account, it will work properly.  If you don't go through this activation process, or it fails, the PIN will not be activated for use; this is a fraud/theft prevention technique.
  • Note that this all happens in a matter of seconds, usually well under two seconds, and rarely longer than eight (which is considered slow).

2.    For PIN Sales
  • You will either start out with what's called a dummy card (or placebo card), which looks like a topup card but has no PIN (it's just for looks/marketing), or you'll simply tell the clerk that you want to buy a replenishment PIN from a specific prepaid wireless provider.
  • They will then use the menu on the POS terminal to select the wireless carrier, and then the product.  For example, electronic PIN, then $25.
  • The terminal will then connect to the appropriate technology provider to request that a $25 PIN be sent to the terminal and printed on a receipt.  Note that some systems actually store a small number of PINs locally in the terminal in case there are system connectivity issues.
  • Assuming you've successful paid, the clerk will then hand you a paper receipt that will have the date and time of the transaction (i.e. sale), as well as the PIN (no scratch off), value of the PIN, and instructions regarding how to add the PIN to your account (also referred to as redeeming the PIN).
  • As for card activations, this occurs in a matter of seconds.  The only difference here is that you won't have a nice pretty card to take home with you (unless they let you keep the dummy card), but rather, you'll have a PIN on a receipt.  So be sure not to lose it!

3.    For Topup Sales (a.k.a. Real Time Replenishment)
  • There's typically no dummy card for topup sales, but you'll probably see a poster or some other indication that the store sells replenishments.  You may not know that it's going to be a real time topup (instead of a card or PIN) until you talk to the clerk.  Some stores do use dummy cards like those described above, that will indicate the available topup values.
  • The clerk will ask you for the wireless phone number of the account (i.e. MDN = Mobile Directory Number) to which you want to add money, and the amount you want to add.
  • Depending on the store and the functionality offered by the wireless provider, you'll either be offered a choice of denominations (ex. $10, $20, $30, $50, $75), or you'll be able to add any amount within the allowed range (ex. between $10 and $99).  There will often be both options for the clerk; i.e. quick buttons for specific amounts, as well as an option to enter any amount (often referred to as "open range").
  • The clerk will typically ask that you pay first before processing the topup transaction.  This avoids issues with returns should you not have cash or a credit/debit card with you that works.
  • Once they receive your money, the clerk will select the right product on the terminal (ex. Verizon Topup).
  • The terminal will prompt the clerk to enter the 10-digit phone number of the account to be replenished.  They'll typically be asked to enter the number twice or verify that the number entered is correct.  This is just an extra step to help avoid errors from entering in a wrong digit.  Accidentally adding money to the wrong account can result in delays and frustrations by both customers and store clerks.
  • The terminal will then prompt the store clerk to either select the amount of the topup or to enter the desired amount.
  • With the phone number and amount, the terminal will now be able to complete the real-time topup transaction.  This is done by having the technology provider use their connection with the wireless provider to verify that the phone number is valid (i.e. it's a real number and the account is not canceled or suspended for some reason).  If the number is valid, the topup is completed immediately, and the terminal receives a success response.  This happens in a matter of seconds.
  • The clerk will then print out a receipt that has a number of things on it, including the date and time of the transaction, phone number replenished, amount added, new account balance, and new account expiration date.

Note that although this type of POS terminal is still around, the industry in general has been moving towards Web Terminals as a preferred approach wherever feasible.  Also, the next generation of this type of functionality is using smartphone applications to process real time payments, and even dispense PINs!

POS Terminals

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