Restaurants patrons are accustomed to paying their bill at the table, but the required portable pin pads are an added expense and a potential headache for management.
However, there are six benefits to upgrading to the new PIN-only POS systems.
Elimination of duplicity
There has been an inherent inefficiency in the hospitality industry – running duplicate transactions for each sale. The bill is printed, followed by an initial credit card charge. After the customer adds in the tip, a third trip is made to finalise the sale.
Mobile technology will remove at least the final step, as the entire transaction can be processed table-side. Some establishments will print the bill at the table and offer to run the card immediately, saving valuable time for the wait staff and eliminating wait times for diners that have finished their meals.
Enhanced security to patrons
Most consumers have heard a horror story about someone in the hospitality industry running up charges on a "borrowed" credit card number. This leads to trepidation with using cards at an unfamiliar establishment.
Tableside PIN transactions mean patrons never have to surrender their card, and that your servers won't be unjustifiably accused of theft.
Better tips for wait staff
Few things bother a server more than that frugal member of a party putting the entire bill on their card. Customers would calculate their bill and tip, and then shuffle their cash to the centre of the table. Then the person using the card would pay the entire bill and collect the cash. That person doesn't want to be on the short end, so any potential shortfall was deducted from the gratuity – just to be safe.
Portable POS transactions make it feasible to run multiple transactions at a single table. Also, customers won't want to appear tight when faced with their server, and one member of the party won't be able to "subsidise" part of his bill with money designated for the tip.
Reduced transaction fees
With a bit of training, servers can have a direct impact on transaction expenses related to card processing. Debit transactions are cheaper than credit, but a signature made credit transactions more convenient for the consumer.
Now that customers will need to use their PIN, wait staff can facilitate debit transactions. This will reduce transaction costs, helping to recoup the expense of portable terminals.
Ability to adjust service dynamics
While the industry norm is servers take the patron's card for processing, this isn't always the most efficient use of their time. Some restaurants actually prefer to remove the server from payment transactions and have customers pay while leaving.
The new PIN standards create a viable explanation for why payment will no longer be taken at the table. A hostess, floor manager, or even the owner can process payments. Proprietors with any concerns on the customer experience should relish this, as they are afforded another opportunity to ask about the service, food, and overall experience.
New technology
There has been an ongoing push for new technology to help small businesses with credit transactions. Smartphone processing is merely the start, and the move to PIN-based processing will continue to drive investments and advances in mobile processing technology. Over time, this will make accepting debit/credit payments easier – and less expensive – for the hospitality industry.
Reduced fraud should, in theory at least, reduce expenses for credit card companies. The savings may not be significant, but as creditors see fraud costs drop, so should their processing fees.
The implementation of PIN-only processing has been rocky. However, improved efficiency, the ability to lower transaction fees, and lower fraud expenses should make the new PIN-based EFTPOS transactions a positive in the hospitality industry moving forward.
