Virtual POS (Point of Sale) is an electronic payment system used to process payments for online purchases. Unlike a physical card reader, a virtual POS operates over the internet and allows customers to pay securely with their credit or debit card details on e-commerce sites.

Virtual POS systems are integrated into merchants' websites and receive the customer's card details during the transaction, processing this information by securely communicating with the bank or payment gateway. This process is carried out using encryption and other security protocols, thus ensuring the security of the customer's financial information.