- SoftPOS, a hardware-free mobile point of sale solution, is ideal for businesses requiring flexibility and reduced equipment costs, offering significant advantages for payment facilitators and software companies.
- Businesses can opt to develop a custom SoftPOS system for greater control or use a white-label solution for ease of implementation, each with distinct cost and control implications.
- Key components for SoftPOS implementation include acquiring bank partnerships, secure encryption key injection, an EMV kernel for transaction processing, and a PCI-compliant payment gateway.
- Successful deployment also requires careful consideration of platform compatibility, streamlined application installation, and comprehensive certification to ensure security and regulatory compliance.
Software point of sale systems or SoftPOS solutions are becoming increasingly popular. In this article we will list the key point of sale system costs and components. You should consider them carefully before implementing a SoftPOS solution. The article is primarily targeted at payment facilitators, software companies, and shopping cart platform owners.
A SoftPOS solution is hardware-free, that is it requires no payment terminals or card readers. This is the key advantage of such innovative point of sale systems. Plus, a handled point of sale system, such as SoftPOS, makesit possible to work in the field. Just bring your phone or tablet with a SoftPOS application!
Not only merchants, but also platforms that service these merchants, also want to benefit from SoftPOS solutions. So, let us briefly describe the two conceptual approaches to and the six key components of SoftPOS solution implementation.
SoftPOS Solution: White Label or Built from Scratch?
If you implement a payment gateway solution, you either can build it in-house or use a white-label offering. Similarly, you can build SoftPOS logic and functionality from scratch or use a white-label SoftPOS system.
Your own SoftPOS solution built from scratch provides almost unlimited control over the whole process. It involves high upfront costs, more development efforts, and greater responsibility. At the same time, it allows you to save on third-party software and eliminate most of transaction fees.
A white label option provides limited control over the process and involves much less liability. Upfront costs are low, but you have to pay transaction fees and software fees further down the road.
In either case you need to be familiar with all major components of a viable SoftPOS system. So, let us address these components.
6 Major Components of a SoftPOS Solution Implementation
- Acquiring bank partnership. First and foremost, you need to define the acquirer, that will underwrite and onboard merchants. Particularly, this acquiring bank should be able to underwrite merchants that will use your SofrPOS solution.
- Injection of encryption keys. In order for the SoftPOS to function properly, customers need to be able to input PINs into mobile devices. So, you need to inject the encryption keys into these devices. For encryption key injection you might require a special HSM. Your key injecting partner should support your target injection methods and be able to obtain the keys from your acquirer.
- EMV kernel. A SoftPOS system is, in fact, an EMV terminal solution without a terminal. So, you will need an EMV kernel. You should know your EMV kernel provider and license fees if it is a licensable product. If you build your own EMV kernel, then you will have to pay for its level 2 certification.
- Deployment phase. Deployment of a SoftPOS solution is, usually, a straightforward process. A SoftPOS is, basically, an Android app (although Apple recently announced the development of its own solution).
- Payment gateway.Your chosen gateway partner should be PCI compliant and integrated with the acquiring bank. More information on payment gateway integration is available in our respective white paper.
- Certification. Besides PCI audit, you will need to go through certification of your SoftPOS solution. You have to choose the certifying company in advance and include certification cost into your budget.
These are the key components (or pre-conditions) of SoftPOS solution development and implementation..
Want to implement a SoftPOS system for your sub-merchants, but need more information? Consult our experts and take a look at our demo! United Thinkers have developed their own licensable SoftPOS product. Besides SoftPOS, its omnichannel payment management software platform, UniPay Gateway, supports multiple other payment terminal solutions.