What is a PDQ Machine?
An odd acronym that’s used primarily in the UK and Kenya, PDQ stands for “Process Data Quickly”, PDQ machines are also commonly known as credit card machines, Chip & PIN machines, or more simply, card readers. Despite the many names, PDQ machines have one defining characteristic, the ability to read card data and process a credit or debit card payment transaction. If you want to accept card payments face-to-face, you’ll need a PDQ machine.
The different types of PDQ Machine
You won’t typically have much say in the brand or manufacturer of your PDQ machine as most are chosen and provided by your merchant acquirer or ISO. But it’s helpful to understand what options are out there and your choice between the different types of PDQ.
The UK PDQ market is dominated by two manufacturers, whose terminals you’ll find in almost every high street or supermarket brand; Verifone and Ingenico, who combined represent a 70% market share. There are also a number of smaller players, most notably the “mPOS” card readers like iZettle. The following manufacturers provide the vast majority of PDQ machines in the UK:
|UK PDQ Manufacturers|
PDQs typically fall into one of four categories; countertop, portable, mobile or mPOS. Although this distinction is starting to blur with the introduction of the new low-cost card readers and “smart terminals”, which include more advanced functionality in one device, it still functions as a good way to categorise different machines. You can find a more comprehensive list of all approved terminals at the UK Card Association.
Countertop PDQs rely on a physical data connection and will be plugged directly into your phone or broadband line. You’ll find these terminals in quick service, fast food and retailers on the high street. Countertop PDQs are typically the fastest to process a transaction as wired networks reduce latency between the machine and the payment gateway.
|Verifone VX 820||£450+ / £26 pm|
|Verifone VX 520||£250+ / £20 pm|
|Ingenico iCT 250||£300+|
Portable PDQs are made up of two parts; the card machine, and the wireless base station. You’ll usually find these terminals in table service restaurants and bars & pubs who need the flexibility to take payment at the table, or away from the counter. These PDQs include a rechargeable battery and Bluetooth or WiFi connectivity to the base station, allowing remote operation of up to 50-100 metres around your hospitality premises.
|Verifone VX 680||£450+ / £26 pm|
|Ingenico iWL250||£450+ / £22 pm|
Mobile PDQs are defined by the ability to process payments without the requirement for a local network connection, instead relying on a mobile 3G or GPRS internet connection. Similar to portable terminals, they include an internal rechargeable battery so you can take payments on the go. Internet connectivity is provided by an embedded data-only SIM card which will usually add a small monthly charge to the cost (around £1-3 / month).
|Verifone VX 675||£250+ / £23 pm|
In recent years, a new type of PDQ has gained popularity among smaller merchants. The mPOS terminals, including; the Square Reader, iZettle Card Reader, PayPal Here Reader, etc. can be thought of as a combination between portable and mobile PDQs. Whilst mPOS readers require the modern equivalent of a base station; a smartphone or tablet, meaning they still rely on a separate device for their internet connection, they can be used both in-store as a countertop machine and at pop-ups and field sales as a mobile PDQ.
|PayPal Here Reader||£29|
To actually process transactions, you’ll need more than just the PDQ machine itself. The software that runs on the machine is responsible for; displaying the total amount due, reading the card magstripe, chip or NFC data, encrypting this and transmitting to the payment gateway amongst other features. There are a few different ways this can happen:
Most PDQs used by small business are non-integrated. This means the PDQ machine has no connection to the point of sale system and requires manual entry of the amount to be paid. Non-integrated PDQs will run software provided by your merchant bank, ISO or the stock software that it ships with.
Integration can vary in definition, but in general, it describes a link between the PDQ and the EPOS system. At it’s simplest this means that when you hit pay on your POS screen, the amount due will be sent to the card machine so the customer can pay immediately. Integration was historically only available to large businesses and corporates, but in recent years this functionality is now available to small business at reasonable cost. More advanced integration is also possible, especially for pay-at-table hospitality venues where split bills, tips and table management can speed up service.
Premium PDQ software allows for a number of additional value-add features to be enabled on the device.
- DCC: Dynamic currency conversion allows customers to pay in their domestic currency, avoiding potentially costly foreign exchange fees on their purchases.
- Loyalty / Gift Cards: Making additional use of the built-in magstripe reader in most PDQs, integrated loyalty functionality allows customers to swipe their loyalty and gift cards to collect and use rewards.
- Tips: Whilst paying tips with cash is easy, card payments haven’t always allowed for a similar simplicity. Built-in tip features helps recover lost tip revenue for servers.
PDQ costs can be broken up into 2 parts, the cost of the physical hardware and the transaction costs. Transaction processing costs can be a complex affair and better covered in our article on card processing costs. However, PDQ costs also have their complexities with two options for purchase:
In contrast to North America, most PDQ machines in the UK are under some form of leasing or rental agreement rather than purchased outright. This has it’s pros and cons, but in general if you get your PDQ from your merchant account provider, your only option will be to lease or rent.
Leasing term lengths vary between suppliers, but typically fall between 18 and 60 month long contracts. Longer contracts are often a source of frustration for merchants who, when trying to exit their contract to switch providers or otherwise, find there are large penalties for early termination.
Whilst you may find it hard to do so, it is possible to buy a PDQ machine outright. Let’s separate this into two categories, the first being mPOS and the second being traditional PDQs. mPOS terminals are almost always sold outright at a low price, often at or below cost, to entice merchants into their payments ecosystem.
However, traditional terminals are rarely available for upfront purchase – ironically, you won’t find any listed online at eCommerce websites to purchase by card.
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