April 11, 2023

Offline Processing: A Smart Way for Your Business to Protect Profits

Offline Processing: A Smart Way for Your Business to Protect Profits

Imagine it’s the busiest part of your day. You have a growing line of customers waiting to pay—and then the worst happens. Your internet goes out. How many sales would your business miss if you lost connectivity and couldn’t process credit card payments?

Whether you experience internet interruptions due to network outages, construction in the area, or other unforeseen issues, offline processing makes it possible to continue accepting payments to protect your profits. In the article below we explain what offline processing is, when you may need to use it, and how the feature benefits your business.

What Is Offline Processing?

Processing a credit card payment requires an internet connection to verify cardholder information, receive an authorization, and complete the transaction. Without a connection, none of those steps are possible—unless your point of sale system has an offline processing mode.

Solutions that enable offline use allow you to continue taking payments without an internet connection.

When to Use Offline Payment Processing

There are common reasons your business may need to take advantage of offline mode, including:

When Your Internet Goes Down
Internet connection failures are the most common reason for shifting into your POS system’s offline processing mode.

When You Take Your Business Outside
If you conduct business away from your main brick-and-mortar location, you may want to process credit and debit card payments offline. This can be useful in the case of pop-ups, fairs, markets, and other special events.

When You Operate in Various Locations
If your business accepts payments in the field, like many HVAC technicians, electricians, plumbers, and delivery drivers do, offline processing is key because you may be at a site, such as a customer’s home, where no internet connection is available.

How Offline Processing Works

Offline processing is possible—you just have to get the right tools and know how to use them.

Step 1: Get a Terminal Built for Offline Payments

Not all terminals and point-of-sales systems are built the same. If you operate in an area where connection is spotty or you’re frequently on the move, you should ensure the solution you pick has offline capabilities. Luckily, there are a number of such solutions available on the market, including our own Exatouch® POS.

Step 2: Configure Your Terminal for Offline Mode

Depending on the system you use, you’ll likely need to change some settings in order to process cards offline. Part of this authorization process may include an acknowledgment of risk—more on that later.

Step 3: Enter Card Information

When your internet connection is down, your offline-enabled credit card processor will either function exactly as normal on the customer’s end—allowing them to swipe, insert a chip, or tap—or it will require manual entry of card information. Make sure you read up on your system’s exact rules ahead of time so you know what to expect.

Step 4: Store Card Information Until You’re Back Online

When you process a card offline, the transaction information is encrypted and stored until you reconnect to the internet. Often, your provider will give you a set timeframe in which you must reconnect. If you miss this window, you may risk losing the transaction information and won’t be able to process your sale.

Are There Risks to Offline Transactions?

It’s important to note that offline processing is reliable and safe, but not risk-free. As we just mentioned, you may lose a sale if your system does not reconnect within a set safety window. You may also lose inventory and money if transactions are ultimately declined when your internet connection is restored. When operating online, your system can automatically check and authorize cards. When you process offline, you won’t get this immediate check to verify whether or not a card is invalid or stolen, but this will happen once you reconnect. If the card isn’t valid, the transaction won’t complete.

You may also encounter some types of cards that can only be processed online, and you might experience slower deposits than you would if you were operating online.

How To Limit Your Risk

Your payment processor likely has some rules in place that mitigate the risks of offline transactions, such as limiting transaction totals, checking expiration dates, comparing the cardholder name and signature with a photo ID, or using a verification code. Exatouch has built-in features that allow you to set acceptable transaction parameters in offline mode.

Furthermore, systems like Exatouch are safer than alternative means of taking card information offline, such as taking physical copies of the card or card info. Exatouch users can rest assured their cardholders’ sensitive information is protected through encryption whether the POS is in offline processing mode or connected to the internet. This is critical for maintaining PCI compliance.

Benefits of a POS with Offline Processing

Exatouch Point of Sale’s offline processing mode enables you to:

  • Take credit card payments when your internet connection fails
  • Continue accessing the hardware you need to do business, including your cash drawer, barcode scanner, and receipt printer
  • Give patrons a uniform customer experience, allowing them to use their preferred method of payment
  • Automatically sync transaction data once connectivity is restored—there’s no need to manually update inventory or add purchase histories to your customer database later

Plus, the system checks for internet access while POS stations are in offline mode once every minute until access is restored. You’ll even see a red banner that indicates when you’re in offline processing mode to ensure there’s no confusion. When a check restores internet access, the system returns to online processing of credit card transactions automatically.

Additionally, Exatouch offers expanded settlement options when closing a batch, including an Offline Sales Report that details which transactions were approved, declined, or failed.

Watch this video to see how offline processing works in Exatouch POS:

As you can see, offline processing offers your business a myriad of benefits. If your current POS doesn’t provide this feature, schedule a complimentary demo to learn more about Exatouch and all of the system’s business-building tools and applications.