Debit cards, also called "check cards," enable purchasers to make electronic purchases debited directly against their bank accounts. Point-of-sale debit transactions — also known as POS debit transactions — come in two main varieties: online debit and offline debit. Online debit, or ATM-debit, transactions requiring a PIN number are routed directly to the customer's bank, which locks in the funds in real time. Offline debit transactions are routed through the interchange system, similar to a credit card purchase. Merchant service providers charge merchants a percentage fee to process offline debit transactions, while online debit transactions typically cost a flat rate per transaction.

Step 1.

Open a business checking account. You must have a business checking account for the merchant services company to route credit and debit payments to you.

Step 2.

Contact a merchant services provider. Banks often contract with merchant services providers to provide this service for the merchant banking customers, or you can contract with one independently.

Step 3.

Purchase or lease a credit card terminal or POS (point-of-sale) software program. You need a phone line to process transactions as well, though low-volume merchants frequently have one phone line for their telephone and merchant services transactions.

Step 4.

Purchase or lease a PIN pad, a device that allows customers to enter their PIN transactions. You don't need a PIN pad to run a debit card such as a credit card, but you must use a PIN pad to run the transaction as an online transaction, which may save you a good deal of money. For example, a merchant paying 2 percent on a $50 average ticket size would pay $1 per transaction. By obtaining a PIN pad, the same merchant may run a $50 transaction as an online debit for 40 cents or less.