What is a Virtual Terminal and How Does It Work?

Last Updated on April 17, 2025 by Robert Luong

If you accept credit card payments by phone, using a virtual terminal simplifies the payment experience and speeds up how quickly your business gets paid.

In this article, you’ll learn what a virtual terminal is, how it works, what you need to use one, and how much it costs to accept payments this way. Whether you run a service-based business or just want a backup for your usual point-of-sale system, a virtual terminal can be a valuable tool to keep cash flowing.

What is a virtual terminal?

A virtual terminal is a secure, web-based tool that turns your computer, phone, or tablet into a credit card terminal. To process a payment, you can manually enter the cardholder’s name, credit and debit card number, billing address, and the three-digit security code (CVV).

Transactions run through the virtual terminal are completed in real-time, just like when you accept in-person payments. Once the transaction is approved, most virtual terminals will give you the option to email a digital receipt to your customer. The virtual terminal works great for businesses that need to bill customers remotely or for those that accept payments over the phone.

How does a virtual terminal work?

A virtual terminal works through your web browser. Here’s what the process usually looks like:

1. Log in to your payment processor’s dashboard and open the virtual terminal.
2. Enter the payment details—this could be the cardholder’s name, card number, expiry date, CVV, and billing address.
3. For ACH or EFT payments, you’ll enter the customer’s bank account and routing numbers instead.
4. Submit the payment to the processor for authorization.
5. The processor communicates with the customer’s bank and card network to approve the transaction.
6. If approved, the funds are deposited into your business bank account—usually within 1 to 3 business days, depending on the payment method.

A virtual terminal works like an online version of a countertop card machine—but instead of your customer tapping or inserting their card, you key in the payment details on their behalf.

The main difference between this and in-person payments is who's entering the information. With a virtual terminal, you—the business owner—enter the details and process the payment for your customer.

What do you need to use a virtual terminal?

You don’t need much to get started. Here’s what you need to use a virtual terminal:

• A merchant account: This is what allows you to process credit card and accept online ACH payments. Most payment processors include access to a virtual terminal with your account—just be sure to check whether it’s included or if there’s an extra fee.
• A device with internet access: A desktop, laptop, tablet, or even a smartphone will do. You can access the virtual terminal through a browser on a desktop, laptop, or tablet, or through a POS app on a smartphone.
• Customer payment details: For card payments, that means the card number, expiry date, CVV, and billing address. For ACH or EFT, you’ll need the bank account and routing numbers.
• Customer billing address: Street address and ZIP/postal code.

Tip: If your payment processor includes customer management tools, you can save customer profiles and payment details for future use. That means faster checkouts for returning clients and less time spent re-entering the same details.

What are the benefits of a virtual terminal?

A virtual terminal gives your business the freedom to accept payments wherever you are—without the need for extra hardware. Here’s why businesses love using it:

• Accept payments from anywhere using just a browser and internet connection—no hardware needed.
• Easily charge repeat customers by accessing stored payment info through customer profiles.
• Keep transactions secure with PCI-compliant processing and encrypted card storage.
• Avoid extra equipment costs by using devices you already own.
• Access virtual terminal at no extra cost.
• Centralize your payments by using one platform for in-person, online, and remote transactions.

1. You can accept payments from anywhere

All you need is a computer or laptop and an internet connection to accept payments. You don't need to meet with customers in-person or bring additional hardware with you. Whether you're accepting payments from home, at your store, or while traveling, the process will be the same.

2. It's easy to bill repeat customers

If your payment processor includes customer management with your account, it's easy to retrieve customer’s payment details and process payments. That saves you time and helps your business serve repeat customers more efficiently.

3. The payments are secure

Your payment processor should be PCI compliant and any customer information stored on file should be securely encrypted. Instead of writing down card numbers during a phone call (which is illegal), your team can enter them directly into a PCI-compliant system. As a result, you don’t have to worry about handling sensitive data.

4. No additional equipment costs

You can access your virtual terminal on devices you already own. There's no need to invest in a card reader or POS hardware. If your business doesn't meet with customers in-person, there is no reason for you to purchase and maintain additional hardware.

5. Included with your account for no extra fee

Many payment processors, like Helcim, include a virtual terminal at no extra cost. If yours doesn’t, it might be worth looking at alternatives—there are plenty of providers that offer it as part of your account without charging additional fees.

6. Keep all your payment information in one place

When you use a virtual terminal alongside other tools—like online invoicing tool, online checkout, or a POS system—from the same provider, everything stays in sync. Your sales, customer details, and inventory data are all connected in one place. That means less time jumping between platforms and more time focused on running your business. Helcim includes all of these tools for no monthly fees or contract.

What businesses should use a virtual terminal?

If you accept payments over the phone or from customers remotely, you can use a virtual terminal. Here are just a few examples of the different ways businesses can use a virtual terminal to get paid:

• Food delivery companies can accept orders and payments over the phone so items are paid for before they are made and delivered.
• Catering companies can take orders online, then call to confirm and process the payment before completing the order and delivering the items.
• Freelancers or contractors can ask customers to call and submit payment when their invoices are due or call to let the customer know when work is complete, so they can pay without having to arrange an in-person meeting.
• Professional service providers including doctors, lawyers, optometrists, or accountants can have their support team follow up by phone to collect payment once tasks are complete, making it easy for customers to submit their payments.
• Auto mechanics can call customers when they have a quote for work that needs to be completed and collect deposits for parts or complete payments over the phone, so when the customer comes to pick up their vehicle the work is already paid for.
• Delivery services including pharmacies, liquor delivery, or florists can call to accept payment before they head out to deliver items. With immediate approvals, they can be confident the products are paid for before they are dropped off.

What does it cost to accept payments using a virtual terminal?

Accepting payments through a virtual terminal cost from 2.3% to 3.5% depending on the payment processors and their pricing model. If you work with a payment processor that offers Interchange Plus pricing like Helcim, you can save 25% on average compared to other payment processors.

The virtual terminal transactions fall under card-not-present credit card processing, which generally carries higher fees than card-present payments due to increased fraud risk.

Even with slightly higher fees, many businesses find it's worth it. Virtual terminals make it easier, faster, and more convenient to get paid—especially when the customer isn’t standing in front of you.

Get a free virtual terminal with Helcim

With Helcim, you get access to a virtual terminal at no extra cost. It’s included as part of your merchant account—no monthly fees, no contract, no surprise charges, and no need to buy additional hardware.

Aside from Helcim Virtual Terminal, you will also get other free tools that make processing payments easier and integrated with your virtual terminal.

• Customer management: Save customer payment details and cards on file securely to speed up repeat billing, track order history, and identify top buyers. Easily retrieve client information and payment to process repeat payment faster.
• Recurring payment software: Automate repeat payments for ongoing services. This saves time and ensures you never miss a billing cycle.
• Inventory management: Payments processed through your virtual terminal will automatically update inventory levels across your sales channels, helping you stay on top of stock.
• Built-in security: With PCI-compliant tools and secure card storage, Helcim reduces your compliance burden while protecting your business.

Helcim provides honest, transparent, and affordable credit card processing. Our Interchange Plus pricing provides the most honest and affordable fees in the industry.

If you’re stuck in a contract with a payment processor that doesn’t offer a virtual terminal—or charges too much to use it—Helcim can help. We’ll cover up to $500 in processing fees to offset your cancellation or equipment costs when you switch.

Break up with bad rates.

Feeling stuck with your provider? We'll waive $500 of your processing fees when you switch to Helcim.

Learn more

FAQ

What is the difference between a payment gateway and a virtual terminal?

A payment gateway is the technology that securely transmits payment information between your website, your customer’s bank, and your payment processor. For example, when a customer clicks “checkout” on your site and is redirected to a secure page to enter their payment info—that page is part of the payment gateway. A virtual terminal, on the other hand, is used by you (the business) to manually enter a customer’s payment details—typically for phone orders or remote billing—when the card isn't physically present. The key difference is who is entering the payment details: the customer (via the gateway) or you (via the virtual terminal).

What is the difference between a payment terminal and a virtual terminal?

A payment terminal is physical hardware used to accept in-person payments by swiping, tapping, or inserting a card. A virtual terminal is a web-based tool that lets you type in the customer’s card details manually. One is for face-to-face payments, the other for remote or phone payments. Both help you get paid, but in different scenarios.

What is the difference between a POS system and a virtual terminal?

A POS (Point of Sale) system is a full setup used for in-person transactions, often with hardware like cash drawers, scanners, and card readers. A virtual terminal is a simple online form where you enter payment info for card-not-present transactions. POS systems often include inventory, receipt printing, and customer management. Virtual terminals are more streamlined, ideal for remote billing or phone orders.

What is a virtual terminal in payments?

A virtual terminal is a secure, web-based tool that lets you manually enter a customer’s payment details to process a transaction. It’s commonly used for phone payments or remote billing. You don’t need a card reader—just a computer, tablet, or phone with internet access. It’s like a digital version of a countertop terminal.

How to create a payment virtual terminal?

You don’t create the terminal yourself—it’s provided by your payment processor as part of your account. Once you sign up, you’ll get access to a dashboard where you can open and use the virtual terminal. From there, you can enter payment details and process transactions. Make sure your provider includes it with no extra fees.