What does a Point of Sale (POS) terminal primarily do?

A Point of Sale (POS) terminal is specifically designed to facilitate and process transactions between customers and merchants at the time of sale. When a customer makes a purchase using a credit or debit card, the POS terminal captures the card information and communicates with payment networks to authorize the transaction. This process includes checking for available funds and verifying that the transaction is legitimate, allowing the sale to be completed quickly and securely.

While other options involve aspects of the broader payment ecosystem, they do not directly describe the primary function of a POS terminal. For instance, offering credit card rewards relates more to the credit card issuing banks rather than the functioning of the POS system itself. Similarly, managing merchant banking transactions involves different tools and systems outside the scope of a typical POS terminal's capabilities. Customer service for cardholders also does not fall within the primary role of a POS, as the terminal's main purpose is transaction processing rather than providing ongoing support or service. Thus, processing transactions with credit or debit cards accurately captures the essence of what a POS terminal primarily does.