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How SoftPOS Applications Work

SoftPOS, or software point of sale, refers to a technology that allows businesses to transform their smartphones or tablets into payment terminals. With SoftPOS, merchants can accept card payments by installing specific software applications and using a compatible card reader or dongle.

Traditionally, point of sale (POS) systems consisted of dedicated hardware terminals, but software point of sale provides a more flexible and cost-effective alternative. By leveraging the existing computing power and connectivity of smartphones or tablets, businesses can accept card payments without investing in additional hardware.

Here’s how SoftPOS card payments typically work:


Software Application: Merchants need to install a software application on their smartphones or tablets. These applications are provided by payment service providers or financial institutions.

Card Reader or Dongle: A compatible card reader or dongle is connected to the smartphone or tablet via the audio jack, USB port, or wirelessly using Bluetooth. Some newer devices also support contactless (NFC) payments without the need for additional hardware.

Card Payment Process: When a customer wants to make a payment, the merchant opens the SoftPOS application on their device. The customer’s card is either swiped, inserted, or tapped on the card reader, depending on the type of card and payment method. The SoftPOS application securely captures the card data and initiates the payment transaction.

Transaction Authorization: The SoftPOS application securely transmits the card data to the payment service provider’s or financial institution’s servers for transaction processing. The payment processor verifies the card details and requests authorization from the cardholder’s bank.

Transaction Approval: The cardholder’s bank approves or declines the transaction based on the available funds and other factors. The approval or decline message is sent back to the SoftPOS application.

Transaction Confirmation: The application receives the response from the payment processor and displays the transaction result on the merchant’s device. If approved, the payment is considered successful, and the merchant can provide the goods or services to the customer.

Receipt Generation: SoftPOS applications often offer the ability to generate digital receipts, which can be emailed or sent via SMS to the customer. Some applications also support printing physical receipts using compatible printers.

It’s important to note that SoftPOS solutions may have different features, requirements, and compatibility with various card types and payment networks. Merchants interested in using SoftPOS should consult with their payment service provider or financial institution to ensure they have the necessary software, hardware, and security measures in place.

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