Our card-acquiring market review identified that point-of-sale (POS) terminal contracts can lock merchants in for as long as 48 months. This raised a concern that long lock-in periods discourage merchants from searching for and switching providers.

We want merchants to have the flexibility to search and switch, or negotiate with their existing provider, and for suppliers of card-acquiring services to develop and offer better and more competitive deals.

Specific Direction 16 (SD16) requires providers of POS terminals to limit the initial length of their contracts for terminal hire to 18 months. This limit will mean merchants can switch more easily when they find a better deal.

This factsheet categorises the range of terminals covered under our SD16. It lists the hardware and software that providers use and explains whether or not our instruction covers them.

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