Online vs. Offline Debit Transactions

woman make payment with swiping machine

Debit transactions are generally processed online or offline. To authorize an online transaction, a customer must submit a personal identification number, or PIN, at the point of sale. With an offline transaction, the customer completes the sale by signing their receipt. Both are legitimate debit transactions that businesses can use.

Here’s a look at the pros/cons of online vs. offline credit card transactions:

The Difference Between Offline and Online Payment Methods

An online debit transaction takes place in a brick-and-mortar store where a customer can swipe their card through a magnetic reader and enter their PIN code on a numerical pad. Each transaction is authorized at the site of purchase, although smartcard solutions, digital certificates, and other technologies may someday allow PIN-based debit processing over the internet. The account is captured and money is transferred to the store owner’s account.

Offline transactions don’t require PINs and are possible wherever credit cards are accepted. To make an offline debit purchase in a store, a customer provides a check card to a merchant, who then swipes the card through a payment terminal. The process is very similar to a credit card transaction. Signing the receipt authorizes the merchant to charge the customer’s account.

An offline transaction can be completed on the web when a customer puts their credit card information into a web-based form. Any data entered are encrypted, captured by transaction processors, and authorized within a credit card processing network.

Offline Payment Processing


  • Transactions are transparent, so both parties know every detail during the purchase.
  • The payment process is simple and direct.
  • A traditional method of payment is used.
  • Users need little understanding of technology.
  • Debit cards can be processed the same way as credit cards.


  • Transactions can be completed only if the credit card machine is online.
  • They are not compatible with high-value transactions, increasing the risk of decline or chargebacks.
  • There’s a risk the transaction won’t be completed, especially if the cardholder has an insufficient balance.
  • Acceptance requires the approval of a third party.
  • Physical distance can limit this payment method.
  • No standards have been developed for web-based offline payment processing.

Online Payment Processing


Woman Using Mobile Payments Online

  • Funds can be transferred quickly, regardless of the amount of money involved.
  • All online transactions can be easily tracked, along with all their details.
  • You can accept any form of payment.
  • A payment gateway helps prevent fraud, as it handles the money during transfer.
  • Transactions can be processed anywhere in the world.
  • Authorization of purchases with PINs reduces risk of chargebacks.
  • Your business can process offline payments if it already accepts credit cards.


  • With online transactions, there is a higher risk of fraud, although online payments have become more secure as the technology has advanced.
  • If identity theft occurs, an individual’s money and data may be lost, causing damage to their personal finances and, possibly, the reputation of your business.

Which One Is Best?

With either online or offline payment processing, your brick-and-mortar business can offer customers flexibility. Providing a choice can improve sales and customer loyalty. PIN-based transactions add additional benefits, such as providing cash back to customers, speeding checkout, and higher rates of transaction approval.

However, verification of signature or, in the case of web-based transactions, a consumer’s credit card information can be beneficial too. Accepting check cards makes your business more accessible to more buyers, such as teenagers who may not have credit. The best option depends on how your business operates and serves customers.

Contact Adept Payments

Are you still weighing processing online vs. offline credit card transactions? Adept Payments offers customized credit card processing solutions that provide businesses with flexibility, convenience, and security. We also help clients support point of sale and mobile processing. Learn more about our credit card processing services, fraud protection solutions, and pricing by continuing to browse, or call 888-732-3838 for assistance.

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