Types of Point Of Sale Activation.

From : intelecard.com.

POSA is not only about activation, it also refers to balance inquiries, refunds, voids, refresh, report printing and can even include services, such as real-time web-based queries. There are two types of POSA available in the market, online solutions and offline solutions.

Online solutions

The term online does not refer to the Internet. An online solution is any technology that requires the POSA device in a store to communicate with the stored value platform at the time of sale. This type of solution involves reading data off a preprinted card and using that data to identify and manipulate a specific stored value account on the platform. The data on the card is usually stored on a magnetic stripe or encoded in a barcode on the product packaging. Either way, at the time of sale the data is read by the POS device and put into a data packet that is sent to the platform as part of an electronic transaction. Sending this packet of data at the time of sale is what specifically defines an online solution.

A communication link or "line," hence the term online, must be established between the POSA device and the platform where the stored value account, or PIN, resides. The POSA device can be a stand-alone POSA terminal or logic integrated into previously installed store equipment, such as credit card processing terminals. There are many different types of communication links and technologies, but for the purpose of this discussion I will illustrate online POSA by discussing two common types of technology, host-to-host and dial up. The distinguishing difference between host-to-host communication and dial-up communication is that one is always connected while the other is used only as needed. Large national retailers who have extensive technology facilities connecting their stores to a central corporate IT location can, and usually do, implement host-to-host connections.

This contrasts with smaller chains or single retail sites that must use the modem in their POSA device to dial the platform on an as-needed basis. A host-to-host solution is always connected. Dial-up communication is established and closed on a per-transaction basis. The point is that implementing online POSA technology requires the ability to support multiple communication mechanisms to the platform, including host-to-host and dial up.

Offline solutions

Offline solutions are the opposite of online, meaning that they do not require the POSA device to communicate with the platform at the time of sale. There is no such thing as an offline host-to-host POSA solution. Additionally, any offline POSA solution not have a PIN-printing solution.

Most PIN-printing solutions print the entire card on blank card stock at the time of sale. Others print only the PIN onto pre-existing cards, while another type of offline mechanism uses preprinted PINs in sticker form that are affixed to preprinted card stock at the time of sale. All offline POSA mechanisms give the retailer a secure way to sell stored value products without the need for the POS device to connect to the stored value platform at the time of sale.

PIN-printing technologies store active PINs and other information in the memory of the POSA device. When a stored value product is purchased, the required information is printed onto card stock or receipt paper. The PIN is already active in this type of POSA mechanism, so there is no need for technology to communicate with the platform for every sale. Instead, at the end of the day these devices typically upload their daily sales totals by dialing into a computer server that collects the data and also downloads more active PINs.