In the modern world, businesses must accept credit card payments in order to stay ahead of the competition. Customers are always looking for the easiest ways to make purchases, which is why contactless payments are on the rise.
Contactless Payments in 2020
What is Contactless Payment?
Contactless payments are a secure method used by consumers to purchase products or services using their credit or debit card.
In order to make a contactless payment, customers tap their card near the point-of-sale terminal that’s equipped with the right payment technology. These payments do not require a signature or personal identification number (PIN). Examples of contactless payments include Apple Pay, Android Pay, and Google Wallet.
Benefits for the Customer
Contactless payments are on the rise this year, and we expect that they’ll only become more popular because of the benefits to the customer and retailer.
Instead of swiping or inserting a credit card, customers simply wave their card near the reader. While you may think that credit cards are already extremely convenient, they’ve become easier to use, and there is virtually no waiting for the card reader to process the payment.
Better Safety and Security
Contactless payments are processed through the same processes as other credit card transactions, which means they’re safe. Contactless payment uses chip technology, which provides protection through encryption and data technologies. This means that it’s more secure than other forms of payment.
There’s less of a risk that the card will be lost or forgotten during the transaction, as well. It never leaves the cardholders’ hand, which means it will go right back in their pocket once the transaction is completed.
Finally, it reduces the chances of thievery. No one can steal the card’s magnetic strip data through skimming, which is the process of procuring card data with an electronic device fraudulently.
Contactless payment technology isn’t delivered on plastic cards and is available in other forms like stickers, key fobs, and mobile wallets that allow smartphones to make payments. This means that customers don’t even have to carry their credit cards, they just have to bring their phone into a store to make a purchase.
Benefits for the Retailer
Contactless payments don’t only offer tons of benefits to customers, but they have advantages for the retailer as well.
Contactless transactions are completed faster than both cash and conventional card transactions, which means that you’ll have shorter lines in your store. With greater efficiency, you’ll also provide your customers with a better experience that keeps them coming back to your store for the best customer service available.
This also means that you’ll require fewer employees on the floor during peak hours, which can save your business money.
Consumers that use contactless payment devices use them frequently because of the ease of use. This is something you should pay attention to because your customers should be your top priority when you’re running a business.
Let’s say that there’s a store similar to yours down the street that doesn’t offer contactless payment solutions, but you do. In this case, you’ll bring in customers partial to this convenience because they’ll prefer retailers who offer their preferred payment method.
Accepting mobile-based contactless payments opens you up to tons of marketing opportunities. You can better integrate with your existing loyalty programs and personal mobile couponing, along with location-based marketing.
Consider digital loyalty programs that reward customers for making contactless payments. For example, you can give discounts or freebies to customers making payments that apply in-store, in-app, or online.
This means that you’ll be able to market your business to your customers better, bringing them in to make contactless payments and higher-value purchases.
No Additional Fees
Accepting contactless payments requires no additional fees for retailers. You will pay the same that you would pay for regular credit card processing through your merchant service provider. This means that offering contactless payments costs you nothing while greatly improving your business.
Challenges of Contactless Payments
We’ve discussed all of the benefits of contactless payments, but there are challenges to accepting these payments as well.
Because this technology is fairly new, it makes sense that millennials and younger generations would embrace it. However, while the newer set is all about going digital, older customers may have trouble shifting to contactless payments. Nevertheless, hopefully, as this payment method becomes more popular, the older set will learn to embrace it.
It isn’t just customers who will need to learn the ropes here. You must also educate your staff and customers about how data is being used so that they can carry out contactless transactions confidently and securely.
Despite these challenges, contactless payment methods are not going away. Going forward, we think you’ll see that the benefits will far outweigh any of the concerns.
Should My Business Accept Contactless Payments?
Given that this payment method option is gaining popularity so quickly and business will not have to pay fees to use it, it’s recommended that you give it a shot. By incorporating these systems, you’ll be investing in the future of your business while meeting current demands of your customers, which will keep them coming back for more.
To -prepare to accept contactless payments, contact your payment provider to ensure that they accept these payments and support the necessary technology.