The Visa Acceptance Cloud will virtualize POS terminals. What will that mean for acquirers and merchants?
The dawn of a new era for point-of-sale terminals may be upon the payments industry with the announcement earlier this year of the Visa Acceptance Cloud. The platform aims to move to a cloud-based platform transactions that have required dedicated software on point-of-sale terminals.
This capability has been proven for years—think semi-integrated point-of-sale systems connected to POS terminals—and its application to standard POS terminals and Internet of Thing devices has the potential to broadly expand what might be considered a payment-acceptance device.
Though some analysts view the acceptance cloud as a further adaptation of devices and acceptance, it remains a new way of thinking about a stalwart of the payments industry. And, as with any change, there are questions about the potential impact.
First, just what is the Visa Acceptance Cloud? Visa says the platform removes the need for payment-processing software to be embedded in each hardware device to be universally accessible in the cloud. The card brand says the platform expands beyond its Tap to Phone technology, announced in 2020. Tap to Phone made it so Android smart phones and tablets could be used as contactless POS terminals with no additional hardware.
As chief technology officer at Paya Holdings Inc., an Atlanta-based payments provider, Balaji Devarasetty has witnessed the ongoing adoption of cloud technology for payments. As EMV became widespread in the United States, POS software developers needed a secure way to capture payment card data without housing it in their applications.
The semi-integrated POS model was ushered in as a way to use a POS terminal to capture the data, send it to the cloud for processing and return the authorization decision to the software, minimizing PCI-compliance matters and reducing risk to the merchant.
“The natural progression was the terminal had to be connected to the cloud, as well,” says Devarasetty. Then, as the EMV rollout continued, NFC was built into the new EMV terminals merchants were using. That trend evolved into a smart POS terminal, like GoDaddy Inc.’s Poynt device, he says. Now, the smart device has become the phone itself.