Wednesday, December 15, 2010

Analog Credit Card Terminals and Digital / Voice Over IP (VoIP) Phone Service

As the popularity of digital and VoIP phone service in today’s business market grows, so do the communication issues with analog machines. As a payment-services, sales professional it is imperative that you are aware of the issues relative to analog equipment and newer digital phone lines to be able to recommend the appropriate alternative solutions.

Analog credit card terminal modems run on an analog frequency that is much slower than a typical digital phone line frequency. Analog equipment has difficulty communicating over the static, line noise and echoes caused by the vast frequency difference between itself and a digital phone line. Ultimately, duplicate transactions, multiple authorizations, transactions that never get processed and modems that wear themselves out are common results. Not-to-mention the initial download of the machine can be a problem.

In many instances, persistence or a DSL filter have become acceptable “work-arounds” for the problem and merchants with analog equipment and digital phone service continue to process. An issue that most merchants and many sales offices are unaware of is that utilizing a PCI Compliant terminal with a standard VoIP connection deems their processing “Non-compliant” with PCI standards.

A PCI Compliant terminal with encrypted VoIP may be compliant if the connection meets requirements of all published Visa and MasterCard (and any other types of cards that you are going to swipe) data security rules, including encryption and firewalls. It must also meet the standards as outlined for your type of business at

This issue is obviously not limited to new business. Existing merchants who have upgraded their analog phone systems to digital are also experiencing frustration with this problem and should be informed of the issues and given the proper options for resolution.

So what are the options? The easiest, but not necessarily the least expensive, solution is to replace the old, analog credit card terminal with an IP-capable device running over an Ethernet connection. Examples of acceptable devices would include the Verifone Vx510 Dual-Comm (both 6 mb and 12 mb) unit or the Vx 570 DC terminals. In some instances it may make sense to suggest a wireless solution such as the Verifone Vx610, PAYware Mobile or Charge Anywhere products. Finally, in others instances a PC-based virtual terminal or client side software solution with a USB mag-card reader may be the best choice.

It is important that you understand the problem and are familiar with all of the possible solutions in order to help your merchants make the best choice. Please feel free to contact our offices to further discuss the issues resulting from digital and VoIP phone systems.


ePay Management