What is a POS transaction?

A POS or point of sale is the point at which a retail transaction is finalized, usually coinciding with the moment a customer makes a payment in exchange for goods. POS transactions are usually completed using debit or credit cards.

To complete a POS transaction, the card usually needs to be authenticated with a PIN number. Signature authorized transactions are also a common occurrence. The information transmitted via the PIN number travels through ATM networks until it reaches the bank, which authorizes or declines it. POS transactions have become common after 1990 and today are used in countries all over the world.