As a business-to-business (B2B) client in the payment industry, selecting the right Point of Sale (POS) system is critical. When choosing between a Banking POS and a Non-Banking POS, it’s important to understand the core differences and how these systems align with your specific needs. This guide will help clarify the distinctions between these two types of POS systems and offer insights on how to make an informed decision based on your business requirements.
What Is a Banking POS?
Banking POS systems are designed to meet the stringent security standards required by banks and financial institutions. They are certified by international security protocols such as EMV (Europay, Mastercard, Visa) and PCI DSS (Payment Card Industry Data Security Standard), ensuring the safe processing of sensitive cardholder data. These terminals are capable of reading various types of payment methods, including magnetic stripe cards, chip cards, contactless NFC payments, and often support a broad range of credit/debit cards like Visa, Mastercard, and Amex.
Key features of a Banking POS include:
- High security standards: These devices must meet EMV and PCI DSS certifications, ensuring safe and compliant transaction processing.
- Multiple card support: Capable of accepting chip cards, magnetic stripe cards, and contactless payments.
- Advanced encryption: Banking POS systems have robust encryption protocols to protect transaction data.
- Durability and reliability: Built for high-frequency usage in demanding environments like retail stores and banks.
- Integration with banking networks: These terminals are often connected to banking networks, providing seamless transaction processing and fraud prevention.
What Is a Non-Banking POS?
Non-Banking POS systems are often used in more general retail environments where high levels of financial security are not as critical. While they still provide the necessary functionality for businesses to process sales, they are usually less expensive and do not require the strict certifications that banking POS systems do.
Key features of a Non-Banking POS include:
- Standard security protocols: While these systems still offer encryption and basic transaction security, they may not comply with EMV or PCI certifications.
- Basic card support: These devices may only accept basic credit and debit cards, without support for advanced payment types like chip cards or contactless payments.
- Cost-effective: Non-banking POS systems are generally more affordable, making them suitable for small businesses with low transaction volumes.
- Simplified functionality: These terminals often come with fewer features, focusing mainly on processing transactions and handling inventory management.
Key Differences Between Banking POS and Non-Banking POS
| Feature | Banking POS | Non-Banking POS |
| Security Standards | EMV, PCI DSS certified | Basic encryption, non-EMV, non-PCI |
| Supported Payment Methods | Chip cards, magnetic stripe cards, NFC, contactless bank cards | Mainly NFC Contactless Basic transactions |
| Cost | Higher due to advanced security and features | Lower, more affordable for small businesses |
| Durability | High, suitable for high transaction volumes | Moderate, not built for intense usage |
| Integration | Linked to banking networks and financial systems | Basic, not directly connected to banks |
| Use Cases | Banks, large retailers, financial institutions | Small retailers, local businesses |
How to Choose Between Banking POS and Non-Banking POS?
For B2B clients like payment platform providers, the choice between a Banking POS and a Non-Banking POS depends on several critical factors:
Security Needs
- If your clients handle sensitive financial data or have regulatory requirements to meet, a Banking POS is non-negotiable. These devices ensure compliance with the highest security standards, protecting your business and customers from fraud and data breaches.
- However, if your clients are small businesses that don’t need the extra layers of security (such as a local coffee shop or boutique), a Non-Banking POS may suffice. These systems offer enough protection for smaller-scale operations without the added complexity and cost.
Transaction Volume and Complexity
- If your clients process a high volume of transactions, especially if they involve different types of cards (magnetic stripe, chip, contactless), a Banking POS is the better choice. These systems are designed to handle a large number of transactions efficiently and securely.
- On the other hand, if transaction volume is low and payment methods are simple, a Non-Banking POS system can be more cost-effective and easier to manage.
Cost Sensitivity
- For businesses on a tighter budget, Non-Banking POS systems offer significant cost savings. They are typically less expensive to purchase, maintain, and integrate. However, this lower price comes with trade-offs in terms of security and functionality.
- If your budget allows, and your business or clients require robust security and the ability to accept a wide range of payment types, investing in a Banking POS is worth the extra cost.
Brand Image and Compliance
- For businesses aiming to build trust with large clients or financial institutions, using a Banking POS with high security certifications can enhance credibility. If your clients require PCI DSS or EMV compliance for their transactions, you cannot afford to use a Non-Banking POS system.
- However, if your clients are not bound by such compliance requirements and don’t process sensitive cardholder data, a Non-Banking POS can serve as a reliable solution.
Conclusion
The choice between a Banking POS and a Non-Banking POS system largely depends on your business model and client needs. For industries that handle large volumes of transactions, require strict security compliance, or have complex payment requirements, Banking POS systems are the clear choice due to their advanced security and versatility. For smaller businesses or those with less stringent security needs, Non-Banking POS systems offer a more cost-effective solution.
By evaluating factors such as security, transaction volume, and budget, B2B clients can choose the POS system that best meets their business and client needs. Both systems have their advantages, and understanding the differences ensures that you provide the most appropriate solution for your customers.
Finding Both Types from: POS Categories – X-Telcom
