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As the world progresses, consumers are expecting more and more from their digital products. Although online banking has been around for a while now, the introduction of mobile payments is a relatively new and natural progression in the use of smart phones and tablets. The appeal of this method of payment has to be the […]
As the world progresses, consumers are expecting more and more from their digital products. Although online banking has been around for a while now, the introduction of mobile payments is a relatively new and natural progression in the use of smart phones and tablets. The appeal of this method of payment has to be the convenience, both for businesses and consumers. Customers often expect the simplest and easiest methods of settling accounts and purchasing goods, which means the use of cash and cheques is quickly becoming obsolete in today’s technology-driven society. If businesses don’t turn to the newest technology they may get left behind as consumers are more likely to buy from companies offering the most convenient payment systems for them.
Mobile Payment MethodsMobile point of sale technology allows a consumer to use their mobile to make a “cardless” transaction, or alternatively requires the attachment of a small card reader to the merchant’s own mobile phone. Being able to settle an account via mobile banking could potentially reduce costs for both consumers and suppliers. For businesses that do not have access to expensive point-of-sale terminals or those which are constantly on the move, the ability to accept customers’ credit card payments via a mobile phone eliminates the need for a fixed phone line and means business can continue as usual.
Some major retailers now offer apps that allow customers to pay a bill by entering their card details and the reference number printed on the till receipt, or sometimes the app has a barcode which is scanned at the till. These systems are becoming very popular in the food industry, particularly at restaurants and coffee shops such as Starbucks and McDonald’s where customer footfall is high.
Consumers have always had concerns over the security of online banking and payment processing, but have become more comfortable with this technology over recent years. In December 2012, Bain & Company’s annual survey “Customer Loyalty in Banking” revealed that 38% of survey respondents in Singapore had used their mobile for a banking transaction in the past 3 months – one of the highest levels of mobile penetration across the globe. This demonstrates a sizeable and growing demand for the use of mobile payment facilities in business in Singapore, despite the long-standing concerns.
The Payment Card Industry Data Security Standards (PCI DSS) were put in place essentially to protect both consumers and merchants from data security risks, but only if the merchant is compliant with these standards to start with. Among other concerns, merchants accepting payments should use SSL encryption and should not store customers’ data. Any business owner confused or worried about security issues should enlist the help of a payment processor as they are specifically equipped for handling payments and should be PCI DSS compliant themselves, thus relieving the merchant of the added responsibility. If they are not, it’s either time to switch or simply to avoid them at all costs!
One of the most important ways for consumers to protect their personal information when making mobile payments is simply to make sure their mobile phone is password or pin protected, thus preventing anyone from accessing the phone if it is lost or stolen. It is well worth installing security software too.
Particularly for small business owners, it is important to bear in mind minimum transaction fees of the provider as these could easily override any savings made by not buying or renting payment terminals. The last thing any business needs is to flat line their revenue by paying more to accept credit and debit cards than the payments themselves actually bring in.
According to Swift White Paper in 2012, it is estimated that over 900 million people will contribute towards £1 trillion in global mobile payments by 2015. Offering mobile payments gives businesses the opportunity to offer a simple, fast, and secure way for customers to pay, which will surely attract new customers and create closer relations between customer and supplier.
Steve works as an online client services manager for a small UK retailer. He has previously written articles on the rise of integrated shopping, multi-platform shopping experiences, and the rise of mobile transactions. He used to have a Blackberry.
