What Is a Virtual Terminal?

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A virtual terminal is basically the web version of a physical credit card terminal or Point-of-Sale (POS) machine. It is a software application that is hosted online, usually on the service provider’s servers, and can be accessed from any internet connected web browser.

A virtual terminal will allow you to input your customer’s credit card information directly into a web-based payment form, which you can then use to process an electronic transaction.

To get a visual idea of what a virtual terminal looks like, see the picture below:

(Click to Enlarge)virtual terminal software

As you can see, the virtual terminal web-form looks pretty much like any payment form that you’d find on an eCommerce website.

You just fill out the required information, and hit the “Submit” button.

Historically, Mail Order or Telephone Order (MOTO) merchants were ideal candidates for a virtual terminal, since they don’t have access to a physical credit card, but that has changed in recent years.

A few merchant account providers (like CDGcommerce) now offer a USB credit card reader that connects to your virtual terminal, so you can process card-present transactions right through your computer.

Here’s an example of what one of those card readers looks like:


So what you do is hook up this reader to your PC, which interacts with your virtual terminal. Then, when you want to process a payment where you have the actual physical credit card, you can just swipe it through the reader. Pretty cool!

The obvious advantage of using something like this is that you won’t have to buy/rent/lease a traditional credit card terminal if you’re only processing retail credit transactions without a signature. The downside of course, is that you can’t collect signatures or accept debit transactions. At least, not yet.

As I mentioned above, I like the CDGcommerce USB reader option, but there are more and more providers that offer this service, so ask around.

Amad Ebrahimi
Amad has worked in the eCommerce and online marketing world since 2002. He started as an eBay seller, then slowly graduated to building & marketing his own websites and consulting others to do the same. He founded Merchant Maverick out of frustration with all the misinformation and shady tactics that he encountered when trying to find a merchant account for his and his client's businesses. He's the man behind most of the merchant account reviews, and articles posted on MerchantMaverick.com. Have any questions related to credit card processing? Talk to him.
Amad Ebrahimi
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    shabih Ahmad

    we r registered society need virtual terminal please help

      Jessica Dinsmore

      Hi Shabih,

      Thank you for your question! It looks like your business is located in India, so I think Instabill is going to be the best option for you. Best of luck to you!

        Arun Kumar Arya

        Hi I am intrested in VT please help me with your contact number to reach you. My number 0091-9874114333

          Chloe Bahal

          Hi Arun,
          I would recommend taking a look at Instabill.


            Regarding the new “chip” readers – when one has a card reader that hooks up to a virtual terminal, is this considered a POS terminal, ie – does the virtual terminal card reader need to be compliant with the new EMV requirements as far as liability goes (being that the card IS present)??

              Tom DeSimone

              Hi Zia,

              It depends. If the card reader just collects the card number and enters it into the form, then the transactions are being processed as “card-not-present” and it doesn’t matter if the chip is read. But some virtual terminals allow you to process transactions as “card-present,” which gives you lower rates but also means that you open yourself up to fraud liability if you swipe a counterfeit chip card after October 1st.

              Most of the time the readers used with virtual terminal just collect the card number and enter into the form, though, in which case it shouldn’t make a difference. You might want to contact your service provider to verify.


                Thank you Tom 🙂


                  Curtis that is an excellent explanation of a virtual terminal and how it works. Very well put. However a couple of updates are appropriate since this the time this article was written.

                  First, signatures are available now with electronic signatures being captured in the same way card data is captured – instead of in this case you’re using an electronic signature pad via the computers USB port in addition to the card reader. Plus, our processer even takes it a step further by enabling remote signature capture, (via email), so a signature can even be obtained on phone orders.

                  Sceond, in addition to MOTO merchants I would add these are ideal solutions for any business which captures transaction data from more than one terminal (e.g., due to having data from more than one department and/or more than one store location). This solution enables these businesses to consolidate all their transaction data into one central location, so with a couple clicks of a mouse they can view, print, export or otherwise access their data for any use, saving them significant time, work and money.

                    Tom DeSimone

                    Hi Virgil,

                    Thanks for your comment. We love PayJunction for this same reason!


                      Any Authorize.net reseller can offer this.

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