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What is a POS?
Point of Sale (POS) is a place where customer makes a payment for the purchased goods and services at a particular store. It is basically the place and time where a retail transaction is completed. For every instance, if a customer is buying something from a store they are completing a Point of Sale (POS) transaction. After the merchant has received the payment, he/she will issue a printed receipt for the transaction to its customers. This receipt can also be sent electronically.
POS that can also be termed as ‘retail management system’ acts as a central component for businesses, as it is linked with sales, customer management, inventory, stock, equipment, staff, etc. POS is an advanced version of excel, book keeping and maintaining manual cash registers. Almost every POS consists of software and hardware components that makes it easy for retailers to manage their daily operations.
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Features of POS
- Used majorly in the retail stores, shops, counters, receptions, etc.
- Helps in sales processing and inventory management
- Keeps supplier’s records and customer’s invoices
- Advanced type of bookkeeping
- Hides barcode label creation
- Removes the hassle of keeping price tags
- Helps in issuing purchase orders
- Keeps record of quotations and stock transfers
- Allows recording and processing of transactions between an enterprise and their customers at the time of the purchase of goods and services
Not all retailers are much familiar with POS machines as they find it bit complicated and makes them hard to change their existing practice of maintaining books. By not using POS, retailers can end up slowing down their operations and missing out on critical data used to expand their businesses.
Components of POS
- Display Unit: Showing the bill
- Barcode Scanner
- Keyboard/touchscreen
- Card and cash drawers
- Card Machine
- EPOS (Electronic Point of Sale) software interface
- Receipt Printer
How does It help to start a business?
Business owners, enterprise, MSMEs, entrepreneurs, retailers can avail Loan against POS machines to start a new business or to operate their existing businesses. This type of loan can also be termed as Merchant Cash Advance in which the loan amount offered by banks and NBFCs depends on business volume generated through POS terminals.
Features
- Attractive interest rates
- Loan amount as per card swipes per month
- Easy and flexible repayment options
- Hassle-free documentation process
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Popular banks and NBFCs offering loans against POS
SBI Power POS Loan
Features
- Loan Amount: 25% of last 6 months’ transactions
- Minimum loan amount: Rs. 25000
- Maximum loan amount: Rs. 5 lakh
- Availed by customers having current account
- Account can be opened by zero balance
- Option of unlimited number of payments and withdrawal facility
- Monthly average balance: RS. 5000
- Free cash deposit up to Rs. 25000 per day
- Free cash withdrawal from home branch
- Free collection through RTGS and NEFT
Kotak Mahindra Bank
Loan against Credit Card receivables
- Can be availed by private and public limited companies, partnerships and sole proprietorship
- Business loan or overdraft amount of up to Rs. 3 crore, based on yearly sales on credit and POS facility
- Collateral is not required
- Sales via credit card over Rs. 60 lakh
- Business should be in profits for last 2 years
- Self-employed with higher preference
- Lower processing fee
- Business existence of at least 3 years
- Option of combining loan with overdraft
Lendingkart Finance
Merchant Cash Advance / Loan against POS
- Loan amount: Maximum up to Rs. 1 crore, depending on the card swipes and monthly card settlements
- Repayment Tenure: From 6 months to 12 months
- Business existence: Minimum 1 year
- POS usage of minimum of 6 months
- Minimum monthly card transactions from Rs. 50,000
- ITR of last 2 years, if business turnover is more than Rs. 10 lakh
NeoGrowth Loan against POS
Neo Cash
- Loan amount ranging from Rs. 1 lakh to Rs. 75 lakh
- Repayment tenure from 18 months to 36 months
- Business operations: Minimum 2 years
- Minimum average monthly
Flexiloans – Loan against POS
- Loan amount up to Rs. 1 crore
- Repayment tenure from 3 months to 24 months
- Repayment frequency: Daily
- Age of business: 1 year
- Collateral is not required
- Monthly business sales: Minimum Rs. 1 lakh
POS system helps its customers in following ways:
- Consolidates purchases and orders in single order
- Helps in scanning and counting of products digitally
- Creates product variations by managing stock
- Identifies pieces of inventory with a unique serial number
- Tracks inventory levels, pricing, gross revenue and sales patterns across the locations
With the emergence and expansion of virtual money in today’s financial market, it has become inevitable for retailers to perform almost every transaction via POS machines. This is required to stay in the competition in the retail sector by luring customers to purchase more and increasing sales. Retailer do introduce various promotional schemes, if customers pay via POS machines. Even to start a new business, entrepreneurs can take loans against POS and can run a startup or use the loan amount for business expansion purposes or to meet working capital requirements.