In short: a payment terminal reads your customer’s card, phone or watch, encrypts the payment data, and sends it over the internet to your payment provider. Your provider passes it to the card network (Visa, Mastercard, Bancontact), which asks the customer’s bank to approve it. The bank replies yes or no. All of that happens in about two seconds. The money itself lands in your bank account the next business day.

That’s how a payment terminal works in a nutshell. Below is what actually happens in each of those steps, what the terminal needs to work, and how the money finds its way to you.

A payment terminal is not the same thing as a cash register

The words get used interchangeably, so it’s worth separating them:

• A payment terminal (also called a card reader, card machine or PIN terminal) does one job: take a payment. It reads the card, secures the data and talks to the banks.
• A POS system (point of sale) is the till around it: your product catalogue, prices, stock, staff logins, VAT reporting and daily sales totals.

Many small businesses run only a payment terminal. Larger ones connect a terminal to a POS system, so the amount is pushed to the terminal automatically instead of being typed in by hand — which removes one of the most common causes of a wrong charge.

The 8 seconds at the counter

1. You enter the amount.
   
   Either you type it into the terminal, or your POS system sends it across. The terminal shows the amount to the customer so they can check it before they pay.
   
   
2. The customer presents their card, phone or watch.
   
   There are three ways in, and the terminal supports all of them:
   
   
   • Contactless (NFC). The card or phone is held a few centimetres from the screen. A short-range radio field powers a chip inside the card, and the two exchange data. Range is deliberately tiny, so nothing gets read from a pocket.
   • Chip and PIN. The card is inserted and stays in the slot. The chip is a small computer, not a storage strip: it generates a unique cryptographic code for this one transaction, which can’t be reused.
   • Magnetic stripe. Largely gone in Europe, but still swiped for the occasional card issued outside the EU.
     
     
3. The terminal builds an encrypted message.
   
   It packages the card details, your merchant ID, the amount and a one-time security code, and encrypts the lot. Card numbers are never held in readable form on the device.
   
   
4. It sends that message to your payment provider (the acquirer).
   
   This is the company that holds your card-acceptance contract. That’s us, Axepta BNP Paribas.
   
   
5. The acquirer routes it to the right card network.
   
   Bancontact for Belgian debit cards, Visa or Mastercard for the rest, American Express or meal vouchers where accepted. The network knows which bank issued the card and forwards the request there.
   
   
6. The customer’s bank decides.
   
   In roughly a second it checks whether the card is valid, whether there’s money or credit available, and whether the payment looks like fraud. It sends back an authorisation code or a refusal.
   
   
7. The terminal shows the answer.
   
   Green: approved. The amount is reserved on the customer’s account. Red: declined. The customer’s bank made that call, not your terminal, and it won’t tell you why (privacy rules). Ask for another card.
   
   
8. The receipt.
   
   Most terminals print one, but can also send it by email or via a QR code. Under Belgian rules you need to be able to produce proof of the transaction, so keep the merchant copy or the digital record.
   
   When a PIN is required varies by card scheme and country. Small contactless amounts usually go through without one, but after a few consecutive taps, or above a set limit, the terminal will ask for a PIN. That’s European law (PSD2 strong customer authentication) working as intended, not a fault.

Who’s actually involved?

The fee you pay per transaction is split between these parties. That’s why pricing differs between a Bancontact payment and an Amex one: they don’t cost the same to process.

What one terminal accepts

A modern terminal in Belgium typically handles, on one device:

• Visa and Mastercard: debit and credit, domestic and foreign
• Bancontact
• Maestro and V PAY where still issued
• Apple Pay, Google Pay and Samsung Pay: these are just a card in a phone’s secure chip; to the terminal they behave like a contactless card
• QR payments via the Bancontact app
• American Express and meal vouchers (Edenred, Monizze, Pluxee), depending on your contract

Your customer doesn’t choose a “type of terminal”, they choose how to pay, and the same device handles it.

What a terminal needs to run

1. An internet connection. The terminal has to reach your provider for every payment. Three options:
   
   
   • Wi-Fi: fine for a fixed counter with a solid signal
   • Mobile data (4G): a SIM card in the terminal; the right choice for markets, terraces, delivery and anywhere the Wi-Fi is unreliable
   • Ethernet: the most stable, if you have a cable at the till
     
     
2. Power. Countertop models stay plugged in. Portable models run on a battery and sit in a charging base between customers; a full day of trading on one charge is normal.
   
   
3. A merchant contract. A terminal on its own can’t do anything. It needs to be linked to an acquiring contract and a bank account. That’s what tells the network where the money should go.
   

How the money actually reaches your account

Approval at the counter is not payment. Two separate things happen:

1. Authorisation (instant): The customer’s bank confirms the money exists and reserves it.
2. Settlement: The terminal closes its batch (usually automatically at the end of the day), and the funds move through the network to your account, minus the transaction fees.
   

Axepta BNP Paribas merchants receive the money the next business day. Weekends and public holidays delay it.

Is it secure?

Card payments are one of the most heavily regulated things a small business does, and almost all of that burden sits with the terminal and the provider rather than with you:

• EMV chip technology generates a single-use code per transaction, so intercepted data can’t be replayed.
• End-to-end encryption means card data is encrypted the moment it’s read and stays that way.
• PCI DSS is the security standard every certified terminal and provider must meet — that certification is why you should never buy a second-hand terminal from an unknown source.
• The PIN pad is tamper-resistant. Open the casing and the device wipes its keys and stops working.
• You never see or store a full card number. Receipts show only the last digits.

Practically: keep the terminal in sight, don’t let anyone “service” it without an appointment you booked, and install the updates your provider pushes.

Do you still need a terminal at all?

Not necessarily. If your card volume is low, seasonal, or you’re on the move, your smartphone can do the same job. Axepta BNP Paribas Soft and Tap to Pay on a smartphone use the NFC chip that’s already in it, with the security handled in an app: no hardware to rent, no charging base, no extra device in the bag. Start accepting payments with your smartphone.

It suits market stalls, deliveries, pop-ups, tradespeople and businesses testing whether card acceptance pays for itself. A dedicated terminal still wins on battery life, receipt printing, speed at a busy counter, and not tying up the phone you also need for everything else. Rent or buy a payment terminal.

Frequently asked questions