What does a virtual terminal refer to?

A virtual terminal refers to a web-based interface that allows merchants to process credit card transactions without the need for physical hardware. It enables merchants to accept card payments through a secure online platform, usually via a web browser. This solution is particularly useful for businesses that operate remotely or via mail order and telephone order (MOTO), as it does not require the physical presence of the customer at a point-of-sale system.

The key feature of a virtual terminal is its ability to facilitate transactions over the internet, capturing necessary card information and processing payments securely from wherever the merchant is located. This flexibility makes it a popular choice for small businesses and service providers who may not have a traditional point-of-sale setup.

Understanding the context behind this answer involves recognizing that a physical credit card terminal refers to hardware used for processing transactions in-person, while a merchant's database management system and point-of-sale software applications are different functionalities that may support broader business operations but do not specifically define what a virtual terminal is. Therefore, the characterization of a virtual terminal as a web version of a credit card terminal aptly highlights its purpose and operations in the payment processing landscape.