Leasing vs Buying a Chip and PIN machine

Being lured in under false hope

We’ve all seen articles in papers or on websites with companies trying to lure us in with special offers to entice us to use their services or a particular product. Here we explore renting vs buying a credit card machine and discuss how each solution may be dependent on the individual’s business.
A common scenario for many considering looking at buying a refurbished PDQ machine is to look at an auction site. A customer sees an attractive piece of kit listed and feels it’s too good to be true, well unfortunately it probably is. Buying a card machine from Ebay or similar auction sites carries all manner of risks and most encounter problems from the outset.
First of all, the chances are the card machine is probably registered to another company, so changing it across to your merchant acquirer is never quite as simple as it may appear. Many payment facilities that end up on auction sites such as ebay are bought at wholesale auctions as a job lot, where perhaps a business is vacating their premises. Chances are the card machine you’ve purchased in good faith for a ridiculously low price may well still be under contract elsewhere and ultimately it may cost you far more financially to change it over before you can actively start using it. Here are some tips if you are considering buying a card machine:
⦁ First and foremost decide if you want a new or refurbished card machine. Refurbished machines should always be rigorously checked before a company deploys them and they should come with a warranty. Purchasing a refurbished machine can sometimes save a company 50% depending on where you shop.
⦁ If you opt to purchase a refurbished card payment machine, ensure the company you are purchasing the equipment from will be able to provide ongoing support. This includes software updates and technical assistance. Some charge for this service, so factor this into any purchase costs and check the small print on the paperwork you are completing.
⦁ Ask the terminal provider or company you are purchasing from whether they manage their own system to support the card terminals. This will ensure that your PDQ machine is connected through the company you are buying from and not a third party. This provides reassurance to the customer should they ever need to raise anything relating to their account. Choosing to buy from a re-seller generally eliminates this problem.
⦁ When buying a Chip and PIN terminal factor in all aspects of your business model. For example – if you are an outdoor business, then buying a counter-top terminal will probably not represent a good investment as most locations you attend won’t be able to offer an infrastructure to cater for this requirement, ultimately meaning that you lose out on sales. Do some research before committing.
⦁ Ensure the card machine you’re purchasing is PCI Compliant. Some companies will offer older card machines at prices that look appealing but due to ongoing developments in the industry, some are no longer PCI compliant and you could incur additional charges from your merchant acquirer as a result.
⦁ If you are a sole trader, purchasing a card terminal may be the best solution. That way you will have sole control over the unit. It’s always a worry for bigger companies when numerous individuals manage the payment facilities and trying to entrust others to look after the equipment.
⦁ When receiving a quote for a terminal purchase, ask the company whether there are any ongoing management fees for technical support and terminal updates. Also request what warranty comes with the item.
⦁ Some companies will tell you that you cannot buy the card machines, this simply isn’t true. Chances are the equipment they’re supplying is probably being leased by the company in the first instance, meaning they can’t sell it on to another business or individual. Any reputable company within the industry will be able to sell or rent you a card machine.
Is a Long Term Rental the way forward?
Long term rentals are particularly popular for companies looking to manage monthly costs into one low cost fee. The market is extremely competitive so shop around and do some research on the company you’re about to commit to. Perhaps look at the case studies on the website. Who do they work with? What are other companies saying about them? How long have they been trading? Are they an official re-seller offering a card machine you want? Do they have social media presence? Simple measures from the outset can eradicate problems arising further down the line. Here are some simple tips for those considering entering a long term agreement:
⦁ How long has the card provider company been trading? Some people feel their merchant bank may offer the most cost effective solution but there are circumstances where they use third parties. Independent hardware providers are normally cheaper as they manage all the equipment and can be more flexible in the final package they’re offering.
⦁ Does the company own the equipment outright or are they using a third party? Don’t be afraid to ask.
⦁ Don’t feel pressured. Some companies will insist on the customer committing to a 4 year agreement. If it doesn’t feel right, don’t do it. Shop around until you find a company that meets your requirement. It may mean you pay an additional couple of pounds each month but ultimately the customer is getting an agreement they’re happy with.
⦁ What if the machine breaks? Check what cover or support is provided. A reputable company will offer a 24 hour swap out service where they replace your card machine next working day.
⦁ If you are a start up business then committing to a 3 year agreement from the outset may not be viable. Factor in all possibilities and see what options are available to you.

I need help!

Sometimes we all encounter technical issues, what support is the company offering? If you are a business that operates during evenings and weekends then you need to ensure that the company you’re committing to will be there to support you out of these hours.
What tips would you recommend?