Acquiring is the acceptance of non-cash payments from customers using plastic cards. For your customer, a transaction requires a tap of their card and it’s over in a few seconds. But behind every payment is an intricate relay between financial institutions, made possible with your acquiring bank.

Acquiring banks process payments for merchants. When your customer submits their payment card details, your acquirer initiates a request to authorize the payment. It goes to the customer’s bank via the networks of the credit and debit card schemes. When the transaction is authorized, the acquirer retrieves the funds. If it’s not authorized, your acquirer tells you why.

A payment terminal, also known as a point of sale (POS) terminal, credit card terminal, EFTPOS terminal (or by the older term as PDQ terminal which stands for "Process Data Quickly"[1]), is a device which interfaces with payment cards to make electronic funds transfers. The terminal typically consists of a secure keypad (called a PINpad) for entering PIN, a screen, a means of capturing information from payments cards and a network connection to access the payment network for authorization.

A payment terminal allows a merchant to capture required credit and debit card information and to transmit this data to the merchant services provider or bank for authorization and finally, to transfer funds to the merchant. The terminal allows the merchant or their client to swipe, insert or hold a card near the device to capture the information. They are often connected to point of sale systems so that payment amounts and confirmation of payment can be transferred automatically to the merchants retail management system. Terminals can also be used in stand alone mode, where the merchant keys the amount into the terminal before the customer present their card and personal identification number (PIN).

Wireless terminals transmit card data using Bluetooth, Wi-Fi, cellular or even satellite networks in remote areas and onboard airplanes.

1. Mobile acquiring. This includes payment via POS terminals: a combined cash register and cashless payment terminal.
2. Merchant acquiring. A special POS terminal is required. The customer uses it to transfer money to an account on the merchant's smartphone or computer.
3. Internet acquiring. No terminal needed, accepts bank cards and e-money over the Internet using a specially designed web interface to make payments in online shops and to pay for various services. Supports virtual cards.

You’ll need a local acquirer or your acquirer must complete cross-border transactions. Cross-border transactions aren’t necessarily troublesome, but they can cause snags in payment processing. Imagine a transaction initiated in the UK by a Swedish shopper with a credit card. If their issuing bank in Sweden doesn’t recognize the acquirer or some element of their authorization request isn’t satisfactory, the request can be refused and the payment declined.

A local acquirer can reduce payment refusals. They have lower fees, higher authorization rates, and settle payments faster. The biggest drawback for you is managing more providers in more territories.

Luckily, some acquirers have anticipated this headache with comprehensive solutions. For example, you could work with one partner who holds local acquiring licences in all the markets where you operate.