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The acronym POS stands for "Point Of Sale". Generally this means the exact location where a purchase is made and payment is completed. This may include face-to-face sales transactions as well as purchases made online. Whether customer is standing at a cashier counter or checking out an online shopping cart, the precise place where payment is made for goods or services ordered or received is considered the point of sale - or POS.

Though most purchases are indeed made at a point of sale - according to financial terminology - only those made with a PIN are considered POS transactions. If a customer chooses to use the credit option when processing payment it will not be considered a POS transaction, he/she will be required to sign for the purchase and will not have the option to receive cash back. Debit (POS) transactions do not require a signature and unlike credit transactions, customers may receive a cashback. Cashback is a service offered to retail customers (not everywhere) whereby an amount is added to the total purchase price of a transaction paid by debit card and the customer receives that amount in cash along with the purchased product.

A POS terminal manages the selling process by a salesperson

accessible interface. The same system allows the creation and printing of the receipt.

Information Technology in Financial Services 丨 Ref Early electronic cash registers were controlled with proprietary software and were very limited in function and communications capability. In 1973 IBM introduced Store Systems that were, in essence, a mainframe computer used as a store controller that could control point of sale registers. By mid-1974, it was installed in selected Department Stores.

The first microprocessor-controlled cash register was built in 1974 for McDonald's Restaurants. Each station was microprocessor controlled. There was one button for every item. When the customer was ready to pay, the [Total] button would calculate the bill. This made it accurate for McDonald's and very convenient for the sales people resulting is shorter wait times for customers in the queues.

Programmability allowed retailers to be more creative. In 1979 some businesses were using POS software to take customer orders.

After many more such interesting innovations, in 1992 the first point of sales software that could run on the Microsoft Windows platform named IT-Retail was created. Since then a wide range of POS applications have been developed on platforms such as Windows and Unix. The availability of local processing power, local data storage, networking, and graphical user interface made it possible to develop flexible and highly functional POS systems. Cost of such systems also declined with the passage of time making such systems possible to use.

Information Technology in Financial Services | Reference Book 2

POS systems gained more popularity as efforts were made to standaf development of computerized POS systems that sim~" interconnections of POS devices. Two such initiatives are OPOS JavaPOS, both of which conform to the UnifiedPOS standard. JavaPOS s Java what OPOS is for Windows. UnifiedPOS is a world- wide vendor retailer driven initiative to provide vendor neutral software appli interfaces for POS peripherals.

Post 2000, web based POS software were developed that can run on computer with an internet connection and supported browser, wia additional software. POS systems that are Internet based are usee businesses with multiple locations. An owner can access the daily t from all locations from a remote site, as well as track sales throughout day. Franchises and businesses with satellite offices track sales connected POS systems and build databases of consumer demogr to guide marketing strategies.

Another variant and advancement in POS systems is Wireless point of (wireless POS or WPOS) which is the use of wireless devices to fa payment for products or services. Typically, a WPOS system consists af base station directly connected to a central network and one or handheld devices that communicate wirelessly.

WPOS can streamline many processes, from buying food at a grocery or restaurant to more sophisticated transactions. Systems may include ability to consummate sales, record and track customer orders, pr credit cards, connect to other systems in a network, and mar inventory. By enabling a vendor to make a transaction or adjus: anywhere within range of the wireless network, WPOS can confirm t a customer's ability to pay and ensure seamless delivery of the d product or service. The technology can dramatically cut costs by

：

■ Eliminating wait times for sales or service ■ Increasing the productivity of individual workers

_ Reducing the cost requirements posed by wired installations. The most common vehicle for a wireless POS transaction is an (radio- frequency identification) system that employs small transpo also called tags, embedded in or attached to specific items. RFID syst use

transmitters and receivers in the radio frequency (RF) portion oJ electromagnetic spectrum to uniquely identify objects or people, technology is coming into increasing use in industry as an alternative the bar code system. Wi-Fi has also entered the marketplace as alternative standard for WPOS, allowing for similar functions existing networks.

Nowadays, Point of Sale Software is only as good as its integration the many popular software & services of the company. Example of software is accounting programs, where all of the daily activities transactions would automatically imported into accounting without labor on the user's end.

The key requirements that must be met by modern POS systems incl

155 Information Technology in Financial Services | Reference Book 2

supportability, low cost, and rich functionality. Most POS hardware also includes barcode swipers that allow the cashier to electronically capture the price, which is automatically entered into the transaction and inventory control programs.

Most POS hardware can be bought separately as plug-and-play devices from different companies. Merchants use point-of-sale (POS) systems to take customer payments by credit cards. Point of sale (POS) payment software allows merchants to collect payments through debit and credit cards immediately when the customer pays rather than waiting to submit credit card payments at the end of each day or according to another company preferred schedule. The POS terminals are typically connected directly to a bank that can credit the user's account and show payment on the merchant's books. A financial tracking system is connected to POS terminals through systems that process credit and debit card payments.

The merchant is charged a fee every time a POS system is used. Merchants receive additional benefits from POS systems, including the ability to display the transaction, calculate taxes and discounts and show payments made. Inventory can be attached to the POS system so that each item sold is automatically removed from the inventory report. Customer preferences, addresses and emails also can be included in the information provided by the software programs. Acknowledging the importance of security requirements, The Secure POS Vendor Alliance (SPVA), a non-profit organization was formed to increase awareness of, and improve, payment security in the electronic point-of-sale industry. The SPVA was founded by the three largest suppliers of point-of-sale payment terminals.

POS Downtime Points of sales systems/devices are computer-enabled and therefore susceptible.to familiar IT-related problems and risks. Most common being power outages, networking problems, software errors and hardware failures. Web POS systems are connected to the World Wide Web and the dangers of virus attacks and denial of service attacks are real. Whatever may be the reason of POS unavailability, the net result is the same - lost business and unsatisfied customers. Companies relying heavily on POS channel must spend generously on them to guarantee their availability and security. First-level defense techniques include use of redundant power supplies, fire-walling web-enabled POS systems, use of anti-malware software etc.

POS Problems

Point of sale systems often features a complex arrangement of hardware, software and network connections. POS systems rely on predictable operation, and problems can appear when hardware, software or concerned humans do not perform as expected.

Hardware Issues

Point of sale systems often involve an array of devices connected with one another using physical cables or secured wireless protocols. Typical

Technology Based distribution channels/Networks in Financial Industry 156 POS components include workstations with screens and keyboards, bar- code scanners, check readers, display screens, cash drawers, receipt printers, customer-facing displays and remote data scanning devices. When one of these devices fails, the entire system may stop working correctly. Many POS systems also include a central server that processes data and coordinates system-wide activity. These servers can experience problems like hard drive and memory failure and other problems commonly associated with personal computers.

Software Issues

Just as POS systems rely on computer-like hardware, they also rely on computer operating systems and special software to perform point of sals functionality. Central servers and checkout workstations often run operating systems similar to those found on personal computers. POS equipment also uses software applications to handle credit card processing, inventory tracking, accounting and other sales-relate: functions. When POS software encounters an error, or when too mu<r software overloads the computer processor or memory, the system can stop working.

Connectivity Issues

When a customer presents a credit or debit card as payment, the point erf； sale system must transmit the account information to the credit card; processing network. According to the Merchant Account Guide webste,| POS systems usually rely on either dial-up modems or broadband Internet services to connect to the processing network. If the network connectionj becomes unavailable, the system will lose the ability to process credit and debit transactions； some systems may also lose the ability to verify check payments. In addition, dial-up connections must have clear audio to communicate with the credit card network properly. If any static exists am the line, the POS system may lose the ability to process credit, debit ami check transactions.

Human-related Errors

Because of the complexity of point of sale systems, concerned staff receive extensive training on how to perform transactions and opers— the system. If incorrect information is provided or wrong applications launched, POS systems may become unpredictable or fail to proc transactions correctly. POS systems are becoming popular in Pakistan and are finding their into businesses as firms and customers realize the safety and conveni these systems offer. POS hardware vendors are also making their eff in making POS technology popular. Many businesses are using native software as it is cost-effective and tailored to specific needs of country. Poor literacy rate in general and less technology awareness particular are significant hindrances in its wide-spread use together cultural barriers and lack of trust as perceived both by buyers and sei丨'

Summary The new IT-based banking channels of service delivery are independent time and distance restrictions making them even more useful valuable for organizations. The net result is the popularity of bran

banking. Branchless banking is a distribution channel strategy used for delivering financial services without relying on bank branches. Examples of branchless banking technologies are the Internet, automated teller machines (ATMs), POS devices and

157 Information Technology in Financial Services | Reference Book 2

mobile phones etc. The key to success is not solely technological innovation, but also integrity. For branchless banking to work, it must be transparent and trusted by the customer. The objectives of the SBP Regulations are to define Branchless Banking activities as a new delivery channel to offer banking services in a cost effective manner. Phone banking is a service provided by a financial institution, which allows its customers to perform transactions over the phone. Phone banking requires a call center which is a centralized location used for the purpose of receiving and transmitting a large volume of requests by telephone. A call center may be operated by a company to administer incoming product support or information inquiries from bank consumers. Computer Telephony Integration is a set of technologies for integrating and managing computers and telephone systems. CTI enables the telephone system to display information via the computer. Interactive voice response (IVR) is a technology that allows a computer to interact with humans through the use of voice and telephone keypad inputs. Downtime is the duration during which their services are not available. Mobile Banking (also known as M-Banking, mbanking, SMS Banking) refers to provision and availability of banking and financial services with the help of mobile telecommunication devices even when users are miles away from their nearest branch or home computer. Banks classify mobile-phone services based on how information flows. A pull transaction s one in which a mobile phone user actively requests a service or nformation from the bank. A push transaction, on the other hand, is one n which the bank sends information based on a set of rules. WAP is the technology architecture that makes accessing Internet pages possible from a mobile phone. An Automated Teller Machine (ATM) is a computerized telecommunications device that provides the clients of a financial institution with access to financial transactions in a public place without the need for a cashier, human clerk or bank teller. An Internet bank is the modern alternative to the traditional bricks-and-mortar (physically existing) banks. An Internet bank is not necessarily the same as an online banking facility of an established bank. A pure Internet bank exists entirely online. These are legitimate banks and all transactions are done over the Internet. Internet banks basically give all the services of a traditional bank except that they don't have the physical structure of a bank. POS stands for "Point Of Sale". Generally this means the exact location where a purchase is made and payment is completed. This may include face-to-face sales transactions as well as purchases made online. Whether customer is standing at a cashier counter or checking out an online shopping cart, the precise place where payment is made for goods or services ordered or received is considered the point of sale. Post 2000, web based POS software were developed that can run on any computer with an Internet connection and supported browser, without additional software.

Reference Links

This chapter is compiled using content on the web at following nor exhaustive list of URLs.

http://www.callcentrehelper.com/the-top-ten-call-centre-problerns-12637.htm http://en.wikipedia.org/wiki/Virtual_queue

Article Source：http://EzineArticles.com/1731778

http://www.articlesbase.com/banking-articles/mobile-banking-definition-and-advantai es 1163722.html#axzz1 QZ360Nzf

http://money.howstuffworks.com/personal-finance/online-banking/mobile-bankingl.ii tm

How Does Internet Banking Work? | eHow.com

http://www.ehow.eom/how-does_5062750_lnternet-banking-work.html#ixzz1Qyo

How Do POS Systems Work? | eHow.com

http://www.ehow.eom/how-does_4922753_pos-systems-work.html#ixzz1RychZvoW Point of Sale Problems | eHow.com

http://www.ehow.eom/info_8091513_point-saleproblems.html#ixzz1RyXiB2qs How Does Point of Sale Work? | eHow.com

http://www.ehow.eom/how-does_4899343_point-sale-work.html#ixzz1RmYSqKNp

Information Technology in Financial Services 丨 Ref

Part 6: Emerging Technology Trends

in Financial Sector

In this part Contactless payment solutions Branchless banking Micropayment Solutions

Open Source software (alternatives to Microsoft and other propriety products)

Image based cheque processing system Biometric ATMs

160

Information Technology in Financial Services | Ref Part Six Learing Outcome New Technology Trends in the