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Auto settling vs. manual settling credit card terminals

Businesses are accustomed to settling (also called batching out) their credit card processing terminal at the end of each business day or first thing in the morning. Settling is the process of moving the transaction information from your business to the cardholder’s (your customer’s) financial institution. Your terminals can be programmed to settle automatically or manually.

There are pros and cons for both methods and you should examine your individual business to decide which method is right for you.

Auto settling 

  • Terminals are programmed to automatically settle the transactions at a specific time each day so you don’t have to remember to batch out.
  • Auto settling is a good method for businesses with a small, trustworthy staff who don’t make many mistakes when inputting transactions.

Manual settling 

  • Busy businesses with a large staff and many people inputting transactions into the terminals may want to choose manual settling since there is a higher probability of mistakes.
  • Manual settling allows the business owner to catch any inconsistencies with transactions and make changes to the batch before the final settlement with the processing bank is made (e.g., any business that adds tips to their transactions at the end of the business day should use manual settling).
  • One con with manual settling is the business owner must remember to settle the credit card terminal at the end of each day. If transactions are not settled within 48 hours the credit card companies will charge the highest possible rates, which is usually twice the normal rates a business owner pays.

Direct your questions about auto and manual settling and all other processing questions to the Retail Council’s credit card processing experts, Michele and Nicholl, at (800) 442-3589.