Although contactless payment technology has been around for years, it wasn’t until the eruption of the Covid-19 pandemic, that 80% of consumers began to utilize this available technology-skyrocketing to an all-time high.
Between March 2019 and June 2020, the United States’ usage of contactless payments increased by 150%. With social distancing, safety, and health as the main topic of global concern, Covid-19 became the driver of contactless payment adoption. But beyond health, there are so many other benefits of contactless payments.
What Are Contactless Payments?
With contactless payments , consumers can make a payment with a credit or debit card via their mobile wallet with smartphone applications like Apple Pay, Google Pay, or Samsung Pay, or the NFC chip embedded into their physical card without the need to swipe, dip, or key in their information. Using NFC-enabled cards, mobile wallets, and QR codes encompasses a world of digital payment technology that will continue to develop.
Contactless cards and mobile wallets use radio frequency identification (RFID) technology which emits radio waves from one equipped device to the other at a short-range distance. Card terminals and contactless cards must be equipped with near-field communication (NFC) capabilities to utilize RFID technology.
NFC capability can be recognized with an icon that looks similar to a Wi-Fi symbol. A contactless card or the smartphone mobile wallet must be hovered over the NFC-enabled terminal to complete a purchase.
iframe width=”1280″ height=”720″ src=”https://www.youtube.com/embed/1RmUIcoTVcw” title=”Financial Tips All Small Business Owners Should Know – Payment Processing” frameborder=”0″ allow=”accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share” allowfullscreen>Contactless Payment Solutions for Merchants
The demand for contactless payment options that evolved during the wake of Covid-19 are here to stay. Each generation is showing an increased interest in adapting to contactless technology.
The Baby Boomer generation has increased from 45% of contactless payment usage before the pandemic to 55% adoption today. According to a study by Visa, if given the option, 63% of consumers stated they would choose a business offering contactless payment options over one that did not. Mastercard’s global study indicated that over 50% of Generation Z and Millenials admitted they would try to avoid shops that did not have the option of contactless payment at checkout.
With the prevalence of consumers now accustomed to the ease, safety, and convenience of contactless payments for consumer options, merchants are now forced into adopting payment processing solutions for contactless options.
Merchants who are reluctant to upgrade to credit card processing terminals with NFC capabilities will fall behind competitors who are advancing with the latest technology and available solutions.
Benefits of Contactless Payments
Over the course of recent years, consumers have discovered the benefits of contactless payments. Despite health and safety concerns being the primary drivers of 2020’s rapid shift, contactless payments had already gained widespread favor due to three simple factors: convenience, speed, and security.
Health and Safety
With a heightened awareness and the main topic of today’s news being the spread of communicable diseases, keeping a distance at checkout and touch-free spending is the trending experience consumers are looking for. Because contactless payments are just that, contactless, there is no exchange between parties with handing the cashier your card, cash, or check. Point of sale is now more hygienic than ever and payments are getting done in the safest fashion available.
Convenient Payments
With the adoption of mobile wallets, your customers can visit your store and leave their physical wallets at home! If a business does not offer the option to pay with the cardholder’s “go-to” method, it may lose prospective clients.
Phones rarely leave our pockets, they are the modern world’s communication device, search engine, clock, camera, and most importantly wallet! It is crucial to offer your consumers transactional ease with more payment services. They get to choose how they would like to pay in a manner that is most convenient for them.
Mobile wallet adoption is ever-increasing in the most recent years and has no intent to stop. Offering payment solutions to your consumers is a business practice that will set you apart from your competition. If your competitor does not offer contactless payments, you will by default be creating repeat business and loyal customers.
Quick Check Out
Even though standard card transactions are much quicker than paying with cash or check, contactless payments are more so instantaneous. A dipped or swiped transaction takes around 3 seconds to transmit card data and receive the appropriate approved or declined response. A contactless payment or “tap-to-pay” transaction will take less than two seconds.
Rapid transaction times will not only please your customers at the point of sale but will also appease the line behind them. Long, slow-moving lines provide a customer the opportunity to re-think their purchase. They may debate if the price is right, if they genuinely need the item, or if their time is more valuable than waiting in line.
Customers forced to wait in slow-moving lines may choose to put some of their merchandise back or walk out of the store altogether. Ultimately, consumers may find another merchant location that has faster-moving lines for a more convenient checkout process.
With contactless payment solutions, you are ensuring your customers that their time is valuable. Contactless payments allow for less time spent at the register.
This generates brief wait times in lines and encourages your customers to visit more frequently. Convenient experiences offer customers more time in their busy day.
Added Security
Another added benefit to contactless payments is the additional security measures in place compared to traditional payment methods. With mobile wallets, full card numbers and personal information is never stored.
Furthermore, during a mobile payment transaction, card data is tokenized and a one-time code is generated for each transaction. The card information such as the verification code (CVV), address, and name are no longer transmitted, as they would be with magnetic stripe-based payments.
Contactless Payment Adoption Conclusion
The use of contactless payments eliminates the need for consumers to swipe, dip or key in their credit card information. This creates added convenience with transactional ease, reduced wait times in line, and simplified payments.
Most importantly, contactless payments are leading the way to pay in today’s society. With Covid-19 precautions at the forefront of consumer needs, contactless solutions are a must.
Showing your customers you care about their health, safety, and time is an appreciated business practice in today’s market. Customer experience is the driving factor to a successful and long-lasting business. Give your customers the best by making sure you are adopting contactless payment solutions.
To contact sales, click HERE. And to learn more about ECS Contactless Payments visit Contactless.
Updated on Jan 2025
