What is a POS system? A guide for Australian businesses

Key takeaways

• A POS (point of sale) system is the hardware and software a business uses to take payments and record sales.

• Costs range from A$0/month for software plus hardware, such as a ~A$65 card reader, to A$575/month or more for advanced plans, plus per-transaction fees.

• Airwallex lets you accept card, wallet and local payment methods online today, with POS Payments for in-person sales coming soon.

A POS system is the combination of hardware and software a business uses to process payments and record sales at the point of purchase. Whether you run a cafe, a retail store or a weekend market stall, it's where every sale is captured, paid for and recorded.

This guide covers how a POS system works, common POS setups, retail and restaurant use cases, what POS systems cost in Australia and how to choose one. Since 1 October 2026, no-surcharge rules apply to eftpos, Mastercard and Visa card payments. With processing fees coming out of your margin, it’s a good time to review your payment setup. 

What does POS stand for?

POS stands for point of sale – the moment and place a customer pays for goods or services. A POS system is the technology that runs that moment: it takes the payment, records the sale and keeps your business data up to date.

You'll also hear EFTPOS, which stands for Electronic Funds Transfer at Point of Sale. An EFTPOS terminal (the card machine) is one part of a POS system, not the whole thing.

How does a POS system work?

A POS system captures what a customer is buying, takes their payment and records the sale in one flow:

1. Select the item: Staff scan a barcode or tap the product on screen.

2. Calculate the total: The system adds up the sale, including 10% GST where it applies.

3. Take payment: The customer taps or inserts their card, pays with a digital wallet like Apple Pay or Google Pay, or pays in cash.

4. Authorise the payment: Card details pass through the card network to the customer's issuing bank, which approves or declines the transaction in seconds.

5. Record the sale: The system issues a receipt, logs the sale and updates your stock levels.

Approved card payments then settle to your business account, typically within 1–3 business days depending on the provider. This step is part of payment processing, which covers everything from authorisation to settlement.

What's included in a POS system?

A POS system includes the hardware you use to take payments and the software that processes them and manages your business data.

POS hardware

• Card reader or EFTPOS terminal: Accepts tap and chip payments. Some also accept swipe card payments.

• Tablet or touchscreen register: Runs the POS software at the counter.

• Receipt printer: Prints receipts (most systems can also email them).

• Barcode scanner: Reads product codes for faster checkout.

• Cash drawer: Stores cash and opens for cash sales.

• Handheld or mobile POS: Takes orders and payments on handheld devices.

If you only sell online, you don't need any POS hardware – your website checkout does the job.

POS software

• Payment processing: Accepts cards and digital wallets.

• Inventory management: Tracks stock and flags when to reorder.

• Sales reporting: Shows what's selling, when and where.

• Staff management: Handles logins, permissions and rosters.

• Customer management and loyalty: Stores customer details and rewards.

• Accounting integrations: Syncs sales with tools like Xero.

Most POS software is now cloud-based, so you can check sales from anywhere. On-premise software runs on local hardware – it can work offline but is harder to update remotely.

What are the 5 types of POS systems?

The five main types of POS systems are countertop, mobile, tablet, self-service kiosk and SoftPOS (Tap to Pay on a phone).

Many businesses mix setups. A restaurant might pair a countertop system with handhelds for tableside ordering. For eCommerce businesses, the online checkout can serve a similar role to a POS by taking payment and recording the sale without a physical counter.

What is an example of a POS system?

A common example of a POS system is a tablet at a cafe counter that takes orders, accepts tap-and-go payments and updates stock automatically.

Picture a customer ordering a flat white. The barista taps the item on the tablet, the customer taps their phone on the card reader, and the system records the sale and deducts the milk from stock.

Now picture a market stall seller with no counter. They take payments on their smartphone using Tap to Pay, with customers tapping their card or phone on the seller's device. For pre-orders, Payment Links let them collect payment remotely without any hardware.

What is a POS system in retail?

A POS system in retail is the hardware and software a shop uses to sell products, track stock and manage returns across one or more locations.

• Barcode scanning and SKU-level inventory: Track every product variant.

• Multi-location stock sync: See stock across all stores.

• Returns and exchanges: Process refunds and swaps at the counter.

• Online store integration: Connect in-store sales with your eCommerce site and payment gateway, so stock and sales stay in sync across channels.

For example, if the systems are integrated, a clothing boutique can sell a jacket in store and automatically update its online stock to reduce the risk of overselling.

What is a POS system in a restaurant?

A POS system in a restaurant is the hardware and software a venue uses to take orders, send them to the kitchen and process payments.

• Table and floor management: See which tables are free, seated or waiting to pay.

• Kitchen display system: Send orders straight to a kitchen screen.

• Tableside ordering and payment: Take orders and payments on handheld devices.

• Split bills and tipping: Divide the bill and let customers add a tip.

For example, a waiter takes an order on a handheld, it appears on the kitchen screen in seconds, and the table later splits the bill four ways.

How much does a POS system cost in Australia?

A POS system in Australia can cost as little as A$0 a month in software plus a A$65 card reader, or A$500+ a month for advanced plans before hardware. There's no single average cost – what you pay depends on three buckets:

• Hardware: From free (Tap to Pay on your phone) to A$65 for a card reader or A$1,000+ for a register.

• Software: Free plans exist; the examples below range from A0toA575+ a month, depending on the provider, plan and billing cycle.

• Processing fees: A percentage of each card payment, typically around 1.5%–1.9% in person.

POS pricing examples 

Since 1 October 2026, no-surcharge rules apply to eftpos, Mastercard and Visa card payments. American Express has separately removed surcharging. Your merchant discount rate – the fee charged by your provider to process card payments – remains a business cost that you can absorb or reflect in your overall pricing.

What is the best POS system for a small business?

The best POS system for a small business is the one that fits how and where you sell, at a total cost that works for your margins. Compare options on these six criteria:

1. How you sell: Match the setup to your channels – in store, mobile, online or all three.

2. Total cost: Add up hardware, software and processing fees, not just the plan price.

3. Payment methods supported: Cards, digital wallets, buy now, pay later (BNPL) and international cards.

4. Integrations: Look for integrated payments and connections to your accounting software and online store.

5. Ease of use and support: Staff should learn it quickly, with help available when needed.

6. Security: Look for PCI DSS compliance and EMV-certified hardware.

Why businesses choose Airwallex for payments

Airwallex Payments lets you accept card, wallet and local payment methods from customers worldwide on one platform.

• Accept 160+ payment methods: Including Visa, Mastercard and Amex, plus Apple Pay and Google Pay.

• Sell globally: Collect payments in 130+ currencies from customers across 180+ countries.

• Avoid unnecessary FX costs: Settle like-for-like in 20+ currencies into your Global Accounts.

• Choose how you integrate: Use Checkout, Payment Plugins or Payment Links.

Coming soon: POS Payments will bring online and in-person payments together on one platform, with an M90 terminal and SoftPOS options for taking payments on compatible phones and tablets.

Frequently asked questions

What is an example of a POS system?

A tablet POS at a cafe counter is a common example. Staff enter orders on the tablet, customers tap a card or phone to pay, and the system records the sale and updates stock. Square, Lightspeed and Shopify POS are examples in Australia.

What is the average cost for a POS system?

There's no single average cost for a POS system in Australia. Expect anywhere from A$0 a month in software plus a A$65 card reader to A$500+ a month for advanced plans, plus in-person processing fees of around 1.5%–1.9% per transaction.

What's the difference between POS and EFTPOS?

EFTPOS is the card terminal that processes card payments, while a POS system is the wider setup that runs your sales. A POS system includes the payment terminal plus software for inventory, reporting and staff management. Many POS systems have EFTPOS built in.

Do I need a POS system for my small business?

You need a POS system if you take in-person payments regularly and want to track sales and stock in one place. For occasional sales, a card reader or Tap to Pay on your phone may be enough. Online-only businesses can use a website checkout.

What's the difference between a POS system and a payment gateway?

A payment gateway securely captures and routes online payment details, while a POS system manages the sale and may connect to an in-person terminal. Businesses that sell online and in person may use both, although some providers bundle these functions.

Sources

• https://www.rba.gov.au/payments-and-infrastructure/review-of-retail-payments-regulation/2026-03/conclusions-paper/faqs/

• https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst

• https://squareup.com/au/en/pricing

• https://www.shopify.com/au/pricing 

• https://www.lightspeedhq.com/au/pos/retail/pricing/