What is Mobile POS System (mPOS)

Everything You Need to Know About a Mobile POS System

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Mobile POS systems are becoming more and more popular in the modern age. In a world where customers prefer convenience above all else, installing a mobile POS system is one of the best things that you can do for your business.

Point of sale systems have come a long way over the past few years. With cloud-based solutions and new technologies rising to the fore, businesses are looking at different ways to facilitate their customers, and a mobile POS system seems like a logical upgrade.

In the past, businesses would rely primarily on manual accounting procedures and cash registers to record entries. All that has changed now, making life considerably easy for small business owners and retailers that want to quickly process payments.

What Is a Mobile POS System (mPoS)?

A mobile point of sale system is a simple point of sale system that can be accessed directly through a mobile device. It can be used to process credit card payments and speed up the checkout process.

Unlike conventional cash registers, mobile point of sale systems are generally portable. You can easily plug the system into a tablet or a smartphone – it hooks up neatly via the charging port, or even the 3.5 mm jack.

This makes it much easier for businesses to process payments quickly and efficiently. Mobile point of sale systems have a built-in card reader that allows employees to process payments quickly without much of a hassle.

As you can imagine, mobile point of sale systems offer a considerable advantage when compared with a conventional cash drawer or register. It’s the ideal point of sale system for small businesses, including food trucks, street vendors, and restaurants.

It allows your waitstaff to quickly process payments from customers tableside only. Mobile POS systems work smoothly on multiple platforms, including both iOS and Android. The user simply has to download a mobile app in order to process payments.

If you are implementing a mobile POS solution, here are the key transaction technologies used nowadays:

  • Quick Response (QR) code processing: Merchants can display their QR codes. A customer just has to scan the QR code with their device to make payments.
  • Europay, Mastercard, and Visa (EMV) payments: A card reader is used for processing payments from these credit cards. All of these are chip cards, so there’s no need for “swiping” to access information from a magnetic stripe.
  • Magnetic stripe reader (MSR): Powered by a POS app, the magnetic stripe reader is a simple handheld device that can hook up to a mobile device. It can be used for swiping and accessing payment information from cards with a magstripe.
  • Magnetic secure transmission (MST): This technology allows for contactless payments. Customers just have to hold up their phone against the mPOS device. The phone emits a signal which is similar to the magnetic stripe found on most payment cards.
  • Near-field communication (NFC): Arguably the most popular mobile payment technology, NFC allows customers to pay using the in-built wallet in their phones, including Google Pay, Apple Pay, and Samsung Pay.

How Do Mobile POS Systems Work?

Mobile POS systems work very similar to conventional POS systems. They make it easy for businesses to streamline inventory management and manage payments from anywhere in the world.

Mobile POS systems usually require a connection to a mobile device such as an iPad, as mentioned above. You can hook up the system via the 3.5 mm headphone jack or the charging port, such as a USB-C or microUSB port. Companies often use a receipt printer to quickly give receipts to patrons, thus greatly increasing the speed of mobile payments processing.

Once connected, you must download the accompanying app and make your account. Then, the app will automatically detect the connected device and allow you to process EMV transactions on the fly.

Many of these devices link well with barcode scanners, allowing you to easily track inventory as well and process payments quickly and efficiently. All you need to get a mPOS system working is a mobile device and an internet connection.

Then, you can simply swipe a customer’s credit card in order to process payments. Mobile point of sale systems have only gotten popular over the past few years.

Source: Statista

As shown above, processed transactions have increased considerably from 2020 to 2022, and they are only projected to increase in the future. Within two years, total transaction values are expected to double!

The reason why mPOS systems are so different from standard POS terminals is because they can be moved around several locations. For instance, in a restaurant, instead of transactions being processed from each table one by one at a fixed location, waitstaff can move from one table to another to process payments quickly and efficiently.

In most cases, the same mPOS software is also used in traditional POS systems, so payment processing is fast and efficient.

Benefits of Installing a Mobile Point of Sale System

Installing a mPOS system requires businesses to bring about a fundamental change in the way payments are processed. It also forces businesses to embrace digitalization on a deeper level.

Ideally, businesses are generally only willing to invest in new technologies if they bring about an improvement in cost and operational efficiencies, and improve customer experiences. Before we talk about the best mobile POS systems, it’s important to discuss the main benefits that you get for installing a mobile point of sale system.

Mitigates The Need for Expensive Hardware

Companies like Square have introduced very affordable mPOS systems that work with their dedicated POS app. They can work just as well in retail stores, restaurants, and at trade shows for making quick sales.

If you have to set up a pop-up store at a trade show or places like farmers markets, just take your credit card reader and mPOS system along. You don’t have to worry about lugging your POS hardware to the event!

This mitigates the need for investing in expensive hardware, because most payments can be processed on devices like a mobile phone or a tablet. The hardware itself is relatively affordable, and support is available from the provider.

Send Digital Receipts

Another reason why mPOS systems are now becoming popular is because they allow companies to quickly send digital receipts to customers. Instead of printing out each receipt and giving it to a customer, a transaction record is automatically generated and the receipt is emailed to the customer.

This also allows businesses to compile email addresses as well as other customer information that can be used for running promotions. However, consent must be acquired before using customer data for marketing purposes.

Ideal for Accepting Contactless Payments

As the world moves towards a touchless future, contactless payments are fast becoming the standard. Most businesses now perceive contactless payments as a necessity instead of a nifty feature.

Native mPOS apps designed for mobile operating systems like Android or iOS provide a higher level of security and efficiency in performance. They also come with a dedicated interface that can be used for self-checkouts. For restaurants, this makes curbside pickup and takeaways more efficient, as payments can be processed without debit cards or cash exchanging hands.

Highly Scalable

Most mPOS apps are cloud-based, so it’s an excellent option for growing businesses. If scalability is a key concern for you, you should absolutely consider going for a mobile POS system.

Instead of having to install an additional POS terminal, all you need to do is to invest in another mobile device, and download the app. The entire system works over Wi-Fi, allowing you to process payments in real-time.

This makes mPOS systems an ideal choice for businesses that have to scale up or down depending upon seasonal fluctuations. Just hook up a new device, and you can have a fully activated POS when you need it. It takes less than 5 minutes to power up a new POS!

Inventory Management Made Easy

Another reason why mPOS systems are becoming popular is because they give users access to a variety of additional information, such as managing inventory and minimizing the risks of a stockout.

With a traditional POS system, inventory management is usually handled separately. However, mobile point of sale systems can be connected directly with the warehousing software, allowing businesses to accurately determine available inventory.

These mobile POS systems can also be used for managing cycle counts and taking stock. This increases accuracy when managing stocks by a significant margin, without costing anything extra!

Cut Down Long Checkout Lines

Long checkout lines have always been a problem at retail stores and supermarkets. As the COVID-19 pandemic spread across the globe, countries introduced social distancing measures, which meant businesses had to do something to facilitate more customers.

Customers don’t want to wait in line to checkout. With a mPOS system, you can process transactions quickly, even setting up a self-checkout counter if you prefer. Customers will be inclined to shop from businesses that prioritize their safety, so it might be a wise idea to invest in mobile point of sale solutions.

More importantly, they will allow you to process payments indoors and outdoors, which significantly reduces lines.

Increased Sales

By removing friction at the point of sale, you will end up selling more. Mobile POS solutions make it easy for businesses to offer loyalty discounts and reward points to recurring customers. This generally increases customer satisfaction and reduces the potential for error when processing transactions.

For restaurateurs, implementing a mPOS system is one of the best options available. It offers much more freedom than conventional POS systems designed for restaurants, and increases table turnover time as well.

How to Choose The Best mPOS System

Making the right selection is important when comparing different mPOS systems. There are quite a few options available, and many of these offer additional features that enhance business flexibility. Here are a few important factors to consider when comparing different mPOS systems.

Support Offline Payments

While mPOS systems require a wireless connection in order to update transactions in the cloud with your payment processor, loss of connection should not render the system useless. In case you are not able to process payments via card, the system should be able to process transactions made by cash, as well as facilitating gift cards or discount coupons, such as those offered by loyalty programs. It should also allow for refunds.

Easy to Use

User-friendliness should be one of the key factors that you should take into account. The mPOS is going to be used by staff in your business, so it’s imperative that it doesn’t require comprehensive training. It should be easy to use, so every member of your team can understand how to process payments.

Minimal Transaction Costs

Most mPOS solutions providers charge a transaction fee for processing payments. Some companies charge a monthly fee, while others may charge a percentage from each transaction. Some even add a hidden fee, so it’s important that you do your research first and compare different options.

Integrate with Existing Systems

The primary reason why so many businesses are adopting mPOS technology is because it is so easy to integrate with existing systems. All it requires is a new mobile device to activate another mPOS. When making a selection, it’s best to look for a mPOS solution that integrates with your existing accounting software and point of sale solutions without compromising on functionality.

For instance, if you also have an ecommerce store, the mPOS system should link between the two seamlessly, so you can get real-time data about sales online and in-store.

Accept All Kinds of Payments

As mentioned above, you should choose a mPOS system that is compliant with EMV cards, including chip-based cards. It should also allow you to accept payments via NFC or QR codes.

Automatic Backups

Most mPOS systems are based in the cloud. That’s what you want to choose for your business too. More importantly, the mPOS system should be able to create automatic backups of all transactions regularly.

Additional Features

More importantly, you should choose a mPOS system that offers additional features like processing orders, managing inventory, and recording customer data. It should have basic tools needed by your employees to process transactions.

Risks of Implementing a mPOS System

While mPOS systems offer a plethora of advantages, you should know that there are a few risks involved as well when using mobile POS software and hardware in your company.

For instance, there’s a significant potential for hacking. If your business does not take cybersecurity seriously, there’s a high risk that someone will try to break into your point of sale system.

These systems rely on standard mobile devices and tablets, which can easily interface with other apps and are open to hacks. For instance, if your Wi-Fi network is not secure, you could expose your network to hackers.

It’s important to use the latest encryption protocols and regularly update the operating system and firmware. More importantly, you will want to make sure that you keep your POS app up to date as well to prevent any security vulnerabilities.

Secondly, if you don’t have a system that supports offline cash processing, you run the risk of losing a sale due to a connection timeout. Even if you can process cash payments, it’s not going to be possible to process card transactions without an active internet connection. That’s the preferred method of payment around the globe.

Ideally, you will want to make sure that a backup internet connection is available in case your primary connection goes down. Otherwise, you won’t be able to accept payments.

Important Things to Know About mPOS Security

Protecting your mPOS system is going to be your biggest priority. Modern mPOS systems like PayPal Zettle or Lightspeed come with a host of security features. The Shopify POS is also PCI DSS compliant (Payment Card Industry Data Security Standard).

When selecting a mPOS system, it’s important that you choose one that is secure and easy to use. Some of the key security features that any mPOS should have are discussed below.

Secure Authentication

The mPOS system should be able to authenticate customer information safely and securely. Credit cards that come with EMV technology have an encrypted chip that contains the user’s information. This is safer than cards with a magnetic stripe, as the chances of skimming are greater with those.

Tokenizing Data

Merchants are not allowed to access a customer’s card information or bank account information. The payments are generally processed with the help of a token. These are randomized numbers that replace the customer’s account information. More importantly, the information pertaining to a customer’s account details or card information should always be secured in a tokenized vault.

End-to-End Encryption

All data processed via the mPOS system should be completely encrypted using an encryption key. These keys can only be decrypted by the payment processor and the sender. This way, even if the payment information is intercepted, it isn’t usable at all.

Compared with traditional POS systems, mPOS systems offer greater security. Companies like Shopify and Square use the latest security protocols to ensure maximum security.

How to Set Up Your mPOS System in 3 Steps

Setting up a mPOS system is very easy. Here’s how you can do it in three steps.

Select a Provider

The first step is to select a mPOS provider. You need to evaluate the factors given above and compare your options before making a decision. Popular options include Square, Shopify POS, Lightspeed, PayPal Zettle, Toast, and Clover.

Install and Set Up the System

Once you order the mPOS system, you just need to set it up. This involves setting up the hardware and configuring the software. You may want to run a couple of test transactions to ensure everything is working smoothly.

Train Employees

Once everything is set up, you just need to train your employees to use the mPOS system. Document key processes and procedures so that it’s easy to train new employees as well. Now, all that’s left is to track just how well your mPOS system is performing!

The Top 3 Mobile POS Systems

To make matters easier for you, we have compared and selected the top 3 mobile POS systems available today.

Shopify POS

shopify pos homepage - what is mpos

Shopify is one of the biggest ecommerce platforms in the world. The Shopify POS is the company’s mPOS solution, and it works a treat. It works seamlessly with Shopify POS hardware, which include card readers, retail stands, mobile receipt printers, barcode scanners, and other important equipment.

It’s very easy to set up, and you also have the option of selecting the Lite package. Above all, if you have an online store that’s built on Shopify, this will help you bring all transactions and payments under one roof.

Square POS

square pos homepage - what is mpos

Square pioneered the mPOS market in 2009, introducing a slew of solutions that are widely used across the globe. Square’s POS connects seamlessly with your online and physical store to track and manage payments from one dashboard.

It is incredibly affordable (no monthly fee), and offers several hardware options, including the Square Register, the Square Stand, and the Square POS terminal. The POS app from Square is incredibly simple to use, and works seamlessly across different devices. If you need an all-in-one mPOS solution that is packed with features, you can’t go wrong with Square!

Toast POS

Toast POS solutions are incredibly nifty, and targeted primarily towards restaurants. Their mobile POS solutions allow for tableside ordering and payment processing, as well as detailed reporting on sales and inventory.

Toast also offers features for labor and inventory management, and there are kitchen display systems to manage schedules behind the scenes as well. They also offer a slew of options for processing payments online as well.

Conclusion

Installing a mPOS system in your business is one of the best decisions that you can make. It’s a forward-thinking investment that will improve sales and allow for efficient operations in your place of business.