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What is a Virtual Terminal?

All businesses, whether a small restaurant or large retailer, have one thing in common: Customers demand the option of paying with a debit or credit card. Some businesses even need to accept eCheck or ACH payments. Using a point-of-sale (POS) system is fine when you’re dealing with customers face-to-face, but some businesses need to accept electronic payments online. 

If you’re trying to process online payments for the convenience of your customers, a virtual terminal is probably the right answer, but it’s different from an online payment form. Here’s what you need to know about choosing and using a virtual terminal for your business. 

What is it? 

A virtual terminal is different from an online checkout form. Any smartphone, tablet, laptop or desktop computer can be transformed into a virtual terminal as long as you have a merchant account that offers a payment gateway. By opening your merchant account’s payment gateway on a device, you have a terminal capable of accepting payments via mail order, email, fax or telephone. 

You can also turn your virtual terminal into an in-person POS system by connecting a card reader to the device’s USB input, but that’s not a requirement. The biggest benefit of a virtual terminal is the ease of setup—there’s no need to find an online payments provider or set up an online checkout form. 

How Do I Use it?

Setting up a virtual terminal is easy and it starts with opening your merchant account dashboard. Navigate to the terminal and then select the type of payment you wish to accept, (i.e., card or ACH). Enter in the total amount of the sale along with any notes you wish to associate with the payment. 

The payment information, like the customer’s credit card or bank account number, will need to be entered by hand. Once you click submit, you’ll see if the transaction is approved or declined. If approved, you can choose to email a receipt to the customer. If needed, you can look over past transactions and issue refunds using the virtual terminal.  

Pros and Cons:

By far, the biggest benefit of using a virtual terminal is the convenience factor. By using any device to access your merchant account’s virtual terminal, you can get up-and-running in mere minutes. Of course, it’s not the ideal solution if it’s your only payment option. Here’s a look at the pros and cons.


  • Quick Set-Up: Just choose your device, open up the virtual terminal, and start processing payments. It’s a great backup or complementary solution to your standard POS system.
  • Multiple Payment Types: If you need to accept cards or ACH payments on the fly, a virtual terminal allows you to do so. Likewise, if you rarely deal with electronic payments, a virtual terminal is probably all you need.
  • One-Time or Recurring: Most virtual terminals give you the option to accept one-time payments or recurring bills. For instance, you can set an invoice to recur monthly or on a schedule, which is great for service-based businesses. 


  • Higher Fees: If you enter a card number by hand as opposed to sliding or dipping it into a card reader, it is a “card-not-present” (CNP) transaction and that means you may pay higher fees. The higher fees are associated with the higher fraud risk of not having the card in hand.
  • Manual Effort: A virtual terminal gives your customers the option to pay by mail, fax, or over the phone, but all of these options mean that an employee has to sit down and manually enter the card information into the terminal.

Is a Virtual Terminal Right for Your Business?

Ultimately, a virtual terminal is an easy way to give your customers more ways to pay, especially if you aren’t working with everyone face-to-face. With that said, you need to consider the pros and cons while thinking carefully about the features. No two virtual terminals are alike and it all comes down to what your merchant services provider offers.

If your virtual terminal happens to have an online payment gateway, which allows customers to enter payment info into a form themselves, it will save your staff time and offer a new level of convenience for your clients. Otherwise, they may have to pay by mail, fax, or phone, in which case you need to consider the time spent manually processing cards and the fact that not all customers will find these options to be convenient.

At the end of the day, a virtual terminal is almost always going to be easier for your business than finding an online payments processor and getting things set up, but you need to think about features and user experience above all else. Luckily, LOLA POS offers a virtual terminal that rivals the best online payment processors. 


LOLA POS. (LOLA POS) is an industry leading merchant advocacy group dedicated to reducing or eliminating the unnecessary fees associated with accepting credit card payments.

Since 2004, LOLA POS’s payment processing solutions have been delivering tailored solutions, best-in-class customer service and high-quality service offerings for local and national businesses across multiple industries.Whether it’s high-risk or low-risk, brick-and-mortar or eCommerce, LOLA POS. will create the best processing experience for your company.For more information, visit www.lolapos.com or call (866) 509-7199 to get started today!

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