How card machines work with a point of sale system

The point of sale builds the order and records the sale, and the card machine sends the payment to your payment provider, which routes it through the card network to the bank that issued the card and brings back the approval or decline.

In South Africa, that round trip runs through the national payment system and takes a few seconds. Problems at this point are a common source of end-of-day mismatches - for example, a payment goes through but the sale is never closed on the point of sale, or the same total gets entered twice.

Even when both functions share the same physical device, these remain separate processes. The point of sale manages the sale record and the card machine manages the payment request.

A card machine connects to a point of sale system in one of three ways:

The terms "integrated" and "connected" are often used interchangeably. What matters is what information moves between the two systems, in which direction, and how the business confirms that both records agree.

On a standalone setup your staff member types the total shown on your point of sale system manually into the card machine. On a connected or integrated setup, the point of sale system automatically sends the correct amount to the card machine. On a combined setup, the same hardware contains both the card machine as well as the point of sale system.

The point of sale system calculates the total, whereas a staff member reads the amount and types it into the card machine.

If they type the wrong amount, the point of sale system will show one total and the card machine processes a different one. The customer may pay R250 on the card machine while the point of sale records a R230 sale. The issue is that both systems think they're correct.

Typing the amount by hand is where small reconciliation mismatches might happen in businesses that use a standalone card machine.

The point of sale system sends the calculated total directly to the card machine. The card machine displays it to the customer and processes the payment. Once approved, the result returns to the point of sale system. The staff member does not have to re-enter the amount.

This removes the double-entry risk, but other risks remain: If the point of sale sends the amount before a last-minute change, or the connection drops mid-transaction, the two records can still diverge.

The sale and payment happen on the same device. The point of sale software calculates the total and the payment function on the same device processes it in sequence. There is no physical handoff and no separate amount entry.

Your staff do one action instead of two, and nobody types an amount in, so the amount can't be mistyped. The records are created by the same software.

No money moves, and on a connected or combined setup the point of sale may receive the decline and keep the sale open for another payment attempt.

When the card machine returns a decline:

1. The card machine shows a decline. No money moves.

2. In a connected or combined setup, the point of sale may receive the decline and keep the sale open for another payment attempt.

3. In a standalone setup, the point of sale doesn't know the payment failed unless the staff member tells it.

What to do? Offer the customer another payment method, or cancel the transaction. Retrying the card straight away, before checking whether the first attempt failed or is still processing, can create duplicate transactions.

If the result is unclear (the card machine shows no response, or the screen freezes), check the transaction status on the card machine before retrying. A payment can be approved on the provider's side while the card machine screen appears stuck.

You refund the sale on the point of sale system and reverse the payment on the card machine, and the money reaches the customer's account on your payment provider's timeline rather than at the moment you process it. A refund touches both the sale record and the payment record in the point of sale system, and how you do it depends on the connection type: 

Connected or combined: The point of sale system may start the refund and send it to the card machine, which processes the reversal with the payment provider. The point of sale updates the sale, stock and reports. Both records stay aligned in one action.

Standalone: The refund may need to be processed separately on the card machine and recorded separately on the point of sale. If a staff member refunds on one system and leaves the other, the sale record and the payment record won't match.

In both cases, a card refund reaches the customer's account according to the payment provider's timeline, not instantly. Don't tell the customer the refund is complete until the card machine confirms it has been submitted.

Compare three totals at the end of each trading day: the point of sale card total, the card machine total, and the provider's payout total.

1. The point of sale card-payment total: the sum of all sales the point of sale recorded as paid by card.

2. The card machine transaction total: the sum of all payments the card machine processed.

3. The payment provider's payout total: the amount the provider reports as due for payout, which may differ due to fees, adjustments or timing.

If records 1 and 2 match, the day's card activity is consistent. If they differ, look for a sale recorded as “card” on the point of sale system but not processed on the card machine, a payment processed on the card machine but not completed on the point of sale system, a refund recorded on one system and not the other, or an amount mismatch from a standalone entry error.

South Africa still runs a large cash economy, so your point of sale system card total won't necessarily be equal to the day's takings. Count the cash separately, match it against what the point of sale recorded as cash, then reconcile the card side.

One system holds a record the other doesn't, so a customer can be charged for a sale the point of sale still shows as open, or the two amounts can differ. Common scenarios include:

When the two records are mismatched, check the card machine's transaction record first. The card machine shows what the payment provider processed and the point of sale system shows what the staff member recorded. Correcting the point of sale system to match the actual payment is safer than assuming the point of sale system is right.

Six problems recur at this connection: double entry, retrying a payment without checking the first one, closing the sale before the result returns, the two devices running on different connections, refunding on one system only, and treating a combined device as risk-free.

1. Double entry on standalone setups. Staff type the wrong amount into the card machine on a standalone setup. Reconciliation catches it, but only if someone checks.

2. Retrying without checking. A payment times out, the staff member retries, and the customer is charged twice. Always check the card machine's transaction record before attempting a second payment.

3. Closing the point of sale sale before the payment result returns. The point of sale system sale is closed before the payment result returns, so it is marked as paid when the card payment may have been declined. On a connected setup, wait for the result. On a standalone setup, confirm on the card machine first.

4. Different connectivity for each device. The two devices run on different connections. The point of sale may use Wi-Fi while the card machine uses mobile data, so one can go offline while the other keeps working. Staff need to know which device is affected and what to do.

5. Refunding on one system only. A card refund processed on the card machine but not recorded on the point of sale system leaves the point of sale system overstating revenue. A point of sale refund recorded but not processed on the card machine leaves the customer without their money.

6. Assuming combined means no problems. A combined device removes the physical handoff and still depends on connectivity, battery and the payment provider's service. If the payment function fails, the point of sale may still allow the sale to be built but not completed by card.

Standalone suits low volumes where someone reconciles carefully, connected suits a busy checkout with multiple staff, and combined suits mobile or tableside service.