Virtual terminal (payment processing)

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A virtual terminal is a software application (often a web application) for merchants which allows them to accept payment with a payment card, specifically a credit card, without requiring the physical presence of the card (“card not present transaction”).[1][2] They are called “virtual” terminals in contrast to the physical payment terminals used to process card payments when the payment card is present.

Use of virtual terminals[edit]

When a customer wants to pay with a card over the phone, a virtual terminal allows the person accepting payment (such as a call center agent) to enter the customer's credit card details to take a payment. Unlike when accepting payment with a regular payment terminal, the presence of the payment card is not required. The payment data is then automatically sent to the payment processor to handle the payment.

While the physical card need not be presented to the merchant (which would be impossible over the phone), the customer authorising the payment should still be in possession of the card. To verify this, the virtual terminal will often require the card security code to be entered, which the customer must supply. One alternative for merchants to having a repeat customer supply this information over the phone is to utilise a credit card vault. Some processors offer their merchants the use of a credit card vault to securely store their customers' card information.[3]

Furthermore, Virtual POS allows for MO/TO payments, also called Mail request/Phone request transactions. MO/TO are suitable for organizations whose customers are far away and therefore, are unable to present a credit or debit card physically. The process is also known as card non-present transaction[4] and includes entering the customer's card details into the virtual terminal to handle the exchange.

Some Companies offering virtual terminal services[edit]

Difference between virtual terminals and Secure Virtual Terminals[edit]

If you have to ask customers to read out their card details to take a payment over the phone, then you are putting your business and your customers at risk.

Your business could be liable for fines for failing to comply with payment security standards (PCI DSS), and privacy laws like CCPA and GDPR.

Although some payment providers present virtual terminals as a safe way to take payments over the phone, they are NOT SECURE if you still have to ask customers to read out their details. Putting both your staff and business at risk.

Some Companies offering Secure Virtual Terminal services[edit]


  1. ^ "Payment Processing: Virtual Terminal for Merchants - PayPal US". Retrieved 2018-12-21. How does Virtual Terminal work? 1. You log into Virtual Terminal. When you’re ready to process a payment, go to and log into your account. Click on Virtual Terminal. 2. You enter the order. Enter the order details and credit card information. 3. You complete the transaction. You’ll receive confirmation for successful transactions.
  2. ^ "Virtual Terminal Credit Card Processing | First Data". Retrieved 2018-12-21.
  3. ^ "What is a Customer Credit Card Vault" by Zachary Nickerson.
  4. ^ "Card non-present payments - Improved authorisation | J.P. Morgan".