EFTPOS is a payment system that offers both customers and businesses the ease of electronic transactions.

In every retail business, convenience is king! And this extends to how customers pay for goods or services. The following will explore the mechanics of the EFTPOS system, how to implement this for a retail business, its benefits, and ways to safeguard it from fraud.

Electronic Funds Transfer at Point of Sale

Electronic Funds Transfer at Point of Sale (EFTPOS) is a payment method that allows customers to make electronic payments directly from their bank accounts at the point of sale. It offers customers a quick and convenient way to pay for their purchases, reducing the need for cash transactions.

The presence of EFTPOS terminals may provide comfort for customers who don’t normally carry cash. DebitCards AU took note of RBA data indicating almost one million terminals active in Australia as of December 2022. Transactions are usually faster than cash transactions, leading to shorter queues and improved customer satisfaction. It also reduces the need for cash handling and the associated security risks for your business.

Transactions through EFTPOS are automatically recorded, simplifying accounting and reducing the chances of errors. Accepting this type of payment can attract more customers, including those who prefer electronic payments over cash.

How it Works

• Customer Initiation: The customer initiates the transaction by selecting the EFTPOS payment option at the point of sale (POS) terminal.
• Card Swiping/Insertion: The customer swipes, inserts, or taps their debit or credit card into the EFTPOS terminal, depending on the type of card and terminal.
• Transaction Data Entry: The customer enters their Personal Identification Number (PIN) or provides a signature to authorise the transaction.
• Authorisation: The EFTPOS terminal securely sends the transaction details to the customer’s bank for authorisation.
• Funds Transfer: If the transaction is approved, the funds are transferred from the customer’s bank account to the merchant’s bank account in real-time.
• Receipt Generation: A receipt is generated, and the transaction is complete.

Implementing EFTPOS for your Retail Business

Setting up EFTPOS for your retail business can be a game-changer. The following are how you can get started.

Choose a Payment Processor

Select a reputable payment processor or acquirer to facilitate EFTPOS transactions. Ensure they offer competitive rates and support a wide range of card types.

Obtain EFTPOS Terminals

Acquire EFTPOS terminals compatible with the payment processor you’ve chosen. These terminals can be purchased or leased. Ensure they are EMV-compliant for security.

Integration with POS System

Integrate the EFTPOS terminals with your point of sale (POS) system. This integration allows for a seamless transaction process and automatic recording of sales data.

Staff Training

Provide training for your staff on how to use the terminals. Ensure they understand the importance of security and customer support when handling transactions.

Compliance and Security Measures

Ensure compliance with Payment Card Industry Data Security Standard (PCI DSS) requirements to protect cardholder data. Implement security measures to safeguard against fraud and data breaches.

Testing and Rollout

Test the EFTPOS system thoroughly to ensure it functions seamlessly. Once satisfied, roll it out to your retail locations.

Safeguard from Fraud

While EFTPOS offers numerous benefits, it’s important to be vigilant and take steps to protect your system from potential fraud:

• EMV Compliance. Ensure your terminals are EMV-compliant. EMV technology provides an added layer of security through chip authentication.
• Regular Software Updates. Keep your EFTPOS software up to date. Manufacturers release updates that often include security patches.
• Secure Network Connection. Use secure and encrypted network connections for transactions to prevent interception of data by cybercriminals.
• PIN Security. Educate your staff on the importance of not sharing or recording customer PINs. Implement PIN encryption to protect this sensitive data. In many cases, staff can do simple ways to protect the customer by letting them type the PIN on the EFTPOS keypad and look away as they do it; the customer may also ensure nobody else is looking either, even security cameras.  
• Transaction Monitoring. Implement real-time transaction monitoring to detect and flag any suspicious activity. Unusual patterns or large transactions should be reviewed.
• Customer Verification. Encourage customers to verify their transactions on the terminal screen before entering their PIN or signing.
• Data Encryption. Ensure that data transmitted between your EFTPOS terminal and the bank is encrypted to protect it from interception.
• Regular Auditing. Conduct regular audits of your EFTPOS system to identify vulnerabilities and address them promptly.

EFTPOS offers both retailers and customers a win-win solution — convenience and security. Implementing this in your retail business can streamline transactions, reduce cash handling, and attract a broader customer base.

By combining the benefits of EFTPOS with rigorous security practices, you can offer a seamless and secure payment experience that enhances customer satisfaction and bolsters your business’ success.

DISCLAIMER: This article is for informational purposes only and does not constitute official business advice. BARTERCARD has no relations with any EFTPOS provider.