Evolution of Electronic Payments
June 7th, 2016 by Elma Jane

Merchants need to stay competitive by offering the most modern forms of electronic payment processing technology to satisfy customers, because, in today’s world of smartphones and one-the-go payments, consumers have options in how they conduct their transactions. With proper education on the types of payment options, merchants can make the right decision for their business.

NTC is here to discuss that payment options.  

EMV – or Europay, MasterCard, Visa is a fraud-reducing technology to protect card issuers, merchants, and consumers from counterfeit or stolen cards. The customer inserts or dips the chip card into the EMV terminal, rather than swiping the card at the point of sale. A one-time-use code is created for that transaction. This code makes it virtually impossible for anyone to duplicate, leaving customers safer from fraud.

NFC – stands for near field communication is a method of contactless data exchange between two electronic devices. NFC is used in mobile wallets such as Apple Pay, Android Pay, and Samsung Pay. More and more consumers leaning towards mobile wallets, merchants should be prepared to accept NFC payments by incorporating NFC-enabled equipment.

Virtual Merchant Mobile Payments – Mobile Payments are popular, you can take payments anywhere. Ideal for retail, restaurant and service businesses of any size. Accept payments your way online, in-store and on the go. Anytime and anywhere.

Offers flexibility you want with the payment security you and your customer need:

  • Accept credit and debit cards, including mag stripe, chip cards, and contactless payments/NFC, like Apple Pay and other mobile wallets.
  • Calculate discounts, taxes, and tips automatically.
  • Email customer receipts.
  • Help protect cardholder data with an encrypted, chip card device.
  • Record cash transactions.
  • Use your own smartphone or tablet (works with most IOS and Android mobile devices).

Check out NTC’s electronic payment solutions that are EMV-capable, NFC-enabled and mobile wallet ready.

 

 

Posted in Best Practices for Merchants, Electronic Payments, EMV EuroPay MasterCard Visa, Mobile Point of Sale, Near Field Communication, Point of Sale, Smartphone, Travel Agency Agents Tagged with: , , , , , , , , , , , , , , , , , , , ,

Contactless
April 27th, 2016 by Elma Jane

Near field communication is a contactless communication protocol between devices like (smartphones, tablets, smartwatches or even credit cards themselves) with a nearby NFC-enabled terminal by simply authorizing your device with a passcode or fingerprint authentication.

Both merchants and customers benefit from near field communication technology, by integrating credit cards, train tickets, and coupons all into one device. Faster payment transaction times and fewer physical cards to carry around.

If your smartphone has an integrated NFC chip, you can use a mobile wallet app like Apple Pay, Android Pay and Samsung Pay for items at retailers that support NFC transactions. Just load up your credit cards on your mobile device and wave or tap your device near an NFC compatible terminal to pay, no card swiping required.

As the technology keeps growing, more NFC compatible smartphones will be available and more businesses will offer NFC card readers for customer’s convenience.

Apple Pay, integrated into the newest generation of Apple mobile devices and incorporates NFC technology. If it becomes widely used by many iPhone users, perhaps merchants will be encouraged to more quickly adopt NFC technology.

Many major banks and credit cards are supporting NFC technology, issuing new cards with embedded NFC chips. This means that you may be able to tap or wave your card at the terminal instead of swiping, no phone required, in the next few years.

 

Posted in Best Practices for Merchants, Near Field Communication Tagged with: , , , , , , , , , , , ,

NFC
February 9th, 2016 by Elma Jane

Since the implementation of the EMV liability shift last year, consumers are still unsure whether to dip or swipe their payment cards at the checkout register, and transaction process itself is slower than a card swipe.

As the EMV process continues, can contactless register only help to make checkout process faster? With contactless register checkout only, consumers can just tap and pay with either card or mobile wallet.

Contactless like NFC is now a standard feature in most high-end smartphones, and most EMV-enabled point-of-sale terminals contain the necessary technology to accept contactless payments. So the idea of contactless register checkout only is something to test for some merchants in a certain retail sector.

 

Posted in Best Practices for Merchants, EMV EuroPay MasterCard Visa, Near Field Communication, Point of Sale Tagged with: , , , , , , , , , , , , ,

January 15th, 2015 by Elma Jane

The fact that your business needs a mobile presence is by no means news. Brands today know that being accessible to the increasing number of smartphones and tablet users is a must NOW, the goal is to provide a top-notch user experience.

Mobile is opening the door for designing new experiences that complement a brand’s physical presence. The context of WHEN, WHERE and WHAT a customer is doing during their day allows companies to enhance a person’s interaction and customize device-specific experiences.

Brands will need to meet the following mobile experience expectations in 2015:

Combating fraud through mobile. Mobile users want to safeguard themselves against fraud, and 56 percent are willing to deal with a slightly more complex user experience if it means greater protection. Businesses can provide an intuitive, high-quality mobile experience that also protects against fraud by offering to validate transactions, set fraud controls and generate unique payment IDs through the user’s mobile device.

Complement, not copy: E-commerce providers must leverage mobile to complement the user experience, rather than provide a replica of what users get through a Web browser. Nearly 4 in 10 mobile users are most likely to use their mobile phone for shopping, so businesses need to ensure that those customers are getting something unique from their mobile interaction.

CRM through mobile marketing: Mobile marketing isn’t just for acquisition anymore. Today, it’s about boosting loyalty by using mobile for customer, consumers always have their mobile device on them and check it more than 150 times a day. Businesses can communicate with their existing customers through alert notifications, in-app, email and mobile Web. But don’t overdo it. The key to maintaining an effective relationship is doing so in a complementary way, giving users what they need when they need it.

Mobile apps and mobile Web: Got a mobile app but not a mobile-friendly website, or vice versa? You might want to put your energy into leveling out your mobile presence. Consumers are about equally split when it comes to their preference of app versus browser: The percentage of users who prefer their mobile browser when completing a task 28 percent is only slightly higher than the 23 percent that prefer to use an app. Both app and Web designs are critical for businesses in the mobile space, so it pays to do them right.

Posted in Best Practices for Merchants, Mobile Payments, Mobile Point of Sale, Smartphone Tagged with: , , , , , , , , ,

October 13th, 2014 by Elma Jane

Non-cash payments volumes are expected to increase by nearly 10% percent to reach 366 billion transactions in 2013, fueled by strong growth in developing markets and mobile payments.

Overall, more than half of global non-cash payment growth comes from developing countries despite them only making up one quarter of the market size at 93 billion transactions. China remains a relatively underdeveloped market for non-cash transactions but its population and growth rate suggest in certain conditions that it could soon outstrip the US and Euro-zone within the next five years.

China is one to watch over the coming years, with the report showing that if growth rates remain at the current high level, it could become the largest market for non-cash transactions within just five years. These soaring growth rates in key markets put pressure on the global payments arena to innovate to meet rapidly increasing consumer demand.

Increased use of tablets and smartphones is creating a convergence of e- and m- payments, posing new challenges for Payments Services Providers (PSPs). In 2015, m-payments are projected to grow at 60.8% while e-payments growth is forecast to decelerate to 15.9% annually over the next year, as more people use mobile devices to make payments.

This trend is adding to the pressure on PSPs to modernize their payments processing infrastructures, ideally based around a single integrated payments platform for corporate and retail payments and a central hub.

The growth of the industry coupled with the fast pace of new regulation requires flexibility from PSPs to adapt, initiatives such as real-time payments, pressure on card interchange fees and improved payments governance as examples of cascading regulation.

Posted in Best Practices for Merchants Tagged with: , , , , , , , , , , , , , , , , ,

September 29th, 2014 by Elma Jane

If  your retail business products sells only in-store, then you’re falling behind. Consumers in the digital age expect options when they shop, and if you’re not offering those choices, your customers may pass you by for a more tech-savvy competitor. Consumers go into stores, evaluate products and buy online, or research online and go into the store for purchase. The two worlds have merged, if you’re not covering both spectrums, you’re missing out.

Recent research by UPS showing 40 percent of today’s shoppers use a combination of online and in-store interactions to complete their purchases. The days of physical stores being separated from online shopping are over. They’re no longer channels that are happening on their own. The UPS survey found that a large chunk of online shoppers cross channels during their shopping path. Be present on both channels and take advantage of that.

It’s not always possible or economic for an online-only retailer to open up a physical storefront, but existing brick-and-mortar stores or wholesalers can easily introduce an e-commerce component to their sales to expand their customer reach. Online sales help reach consumers that may not otherwise be able to purchase your products. Even if your company’s main focus is creating a personalized in-store experience, there are still ways to capture the online shopper market. In addition to giving consumers a way to research your products before coming in-store to purchase your offerings, you can offer people a way to conveniently buy items they already know they want.

For all the advantages a multi-channel sales strategy can give a retailer, there are still some challenges to this approach. Managing inventory versus cash flow and ensuring even demand on both channels have been company’s two greatest challenges in balancing in-store and online sales. Creating demand is how companies set themselves apart from competition. The secret sauce. The challenge is making sure that retail operations have a turnover ratio that works for the shipping schedules from the main warehouse. This isn’t a problem for e-commerce businesses, because product can be packaged and shipped as fast as it gets produced. But an omnichannel company has to take retail and e-commerce into account when stocking a warehouse.

There are a few different strategies retailers can use to help keep their sales operations well-balanced. Offering different items online versus in-store, to avoid inventory competition (i.e., selling seasonal or discontinued items online and current items in-store). Requiring a minimum order for online purchases or grouping products together rather than selling them individually to make e-commerce more worth your while.

The best way to balance a multi-channel sales strategy is to take a unified view of consumers online and offline by connecting their on- and offline behaviors via technology. Some of the retailers questions have is how to connect a person offline with what they buy online, how to recognize who they are in the store and know what they look at on your website, because people are switching back and forth. Link behaviors online with a unique ID through email or a mobile app, since 66% of customers use smartphones in-store.

Even if your business can’t actually sell and ship products via e-commerce,it’s still important to be in tune and up-to-date with the way customers want to interact with you on the Web. People are on the go, researching on phones and tablets. If you’re not savvy to what’s happening out there and don’t have the best-in-class SEO, you’ll miss out. You still need to engage in the digital world, even if it’s not always obvious.

 

Posted in Best Practices for Merchants, e-commerce & m-commerce Tagged with: , , , , , , , , , , , , , , , , , , ,

September 10th, 2014 by Elma Jane

If your businesses considering an iPad point-of-sale (POS) system, you may be up for a challenge. Not only can the plethora of providers be overwhelming, but you must also remember that not all iPad POS systems are created equal. iPad POS systems do more than process payments and complete transactions. They also offer advanced capabilities that streamline operations. For instance, they can eliminate manual data entry by integrating accounting software, customer databases and inventory counts in real time, as each transaction occurs. With these systems, you get 24/7 access to sales data without having to be in the store. The challenge, however, is knowing which provider and set of features offer the best iPad POS solution for your business. iPad POS systems vary in functionality far more than the traditional POS solutions and are often targeted at specific verticals rather than the entire market. For that reason, it’s especially important to compare features between systems to ultimately select the right system for your business.

To help you choose a provider, here are things to look for in an iPad POS system.

Backend capabilities

One of the biggest benefits of an iPad POS system is that it offers advanced features that can streamline your entire operations. These include backend processes, such as inventory tracking, data analysis and reporting, and social media integration. As a small business, two of the most important time saving and productivity-boosting features to look for are customer relationship management (CRM) capabilities and connectivity to other sales channels. You’ll want an iPad POS that has robust CRM and a customizable customer loyalty program. It should tell you which products are most and least frequently purchased by specific customers at various store locations. It should also be able to identify the frequent VIP shoppers from the less frequent ones at any one of your store locations, creating the ultimate customer loyalty program for the small business owner. If you own an online store or use a mobile app to sell your products and services, your iPad POS software should also be able to integrate those online platforms with in-store sales. Not only will this provide an automated, centralized sales database, but it can also help increase total sales. You should be able to sell effortlessly through online, mobile and in-store channels. Why should your customers be limited to the people who walk by your store? Your iPad POS should be able to help you sell your products through more channels, online and on mobile. E-commerce and mobile commerce (mCommerce) aren’t just for big box retailers.

Cloud-based

The functions of an iPad POS solution don’t necessarily have to stop in-store. If you want to have anytime, anywhere access to your POS system, you can use one of the many providers with advanced features that give business owners visibility over their stores, its records and backend processes using the cloud. The best tablet-based POS systems operate on a cloud and allow you to operate it from any location you want. An iPad POS provider, with a cloud-based iPad POS system, businesses can keep tabs on stores in real time using any device, as well as automatically back up data. This gives business owners access to the system on their desktops, tablets or smartphones, even when not inside their stores. Using a cloud-based system also protects all the data that’s stored in your point of sale so you don’t have to worry about losing your data or, even worse, getting it stolen. Because the cloud plays such a significant role, businesses should also look into the kind of cloud service an iPad POS provider uses. In other words, is the system a cloud solution capable of expanding, or is it an app on the iPad that is not dependent on the Internet? Who is the cloud vendor? Is it a premium vendor? The type of cloud a provider uses can give you an idea about its reliability and the functions the provider will offer.

Downtime and technical support

As a small business, you need an iPad POS provider that has your back when something goes wrong. There are two types of customer support to look for: Downtime support and technical support.

iPad POS systems are often cheaper and simpler than traditional systems, but that doesn’t mean you can ignore the product support needs. The POS is a key element of your business and any downtime will likely result in significant revenue loss. You could, for instance, experience costly downtime when you lose Internet connectivity. iPad POS systems primarily rely on the Web to perform their core functions, but this doesn’t mean that when the Internet goes down, your business has to go down, too. Many providers offer offline support to keep your business going, such as Always on Mode. The Always on Mode setting enables your business to continue running even in the event of an Internet outage. Otherwise, your business will lose money during a loss of connectivity. Downtime can also happen due to technical problems within the hardware or software. Most iPad POS providers boast of providing excellent tech support, but you never really know what type of customer service you’ll actually receive until a problem occurs.

Test the friendliness of customer service reps by calling or emailing the provider with questions and concerns before signing any contracts. This way, you can see how helpful their responses are before you purchase their solution. Your POS is the most important device in your store. It’s essentially the gateway to all your transactions, customer data and inventory. If anything happens to it, you’ll need to be comfortable knowing that someone is there to answer your questions and guide you through everything.

Grows with your business

All growing businesses need tech solutions that can grow right along with them. Not all iPad POS systems are scalable, so look for a provider that makes it easy to add on more terminals and employees as your business expands. Pay attention to how the software handles growth in sales and in personnel. As a business grows, so does it sales volume and the required software capabilities. Some iPad POS solutions are designed for very small businesses, offering very limited features and transactions. If you have plans for growth, look for a provider that can handle the changes in transactions your business will be going through. Find out about features and customization. Does the system do what you want it to do? Can it handle large volume? How much volume? What modules can you add, and how do you interface to third parties? You should also consider the impacts of physical expansion and adding on new equipment and employees. If there are plans in the future for you to open another store location, you’ll need to make sure that your point of sale has the capabilities of actually handling another store location without adding more work for you. If you plan on hiring more employees for your store, you’ll also want to know that the solution you choose can easily be learned, so onboarding new staff won’t take up too much of your time.

Security

POS cyber attacks have risen dramatically over the past couple of years, making it more critical than ever to protect your business. Otherwise, it’s not just your business information at risk, but also your reputation and entire operations. iPad POS system security is a bit tricky, however. Unlike credit card swipers and mobile credit card readers that have long-established security standards namely, Payment Card Industry (PCI) compliance — the criteria for the iPad hardware itself as a POS terminal aren’t quite so clear-cut. Since iPads cannot be certified as PCI compliant, merchants must utilize a point-to-point encryption system that leaves the iPad out of scope. This means treating the iPad as its own system, which includes making sure it doesn’t save credit-card information or sensitive data on the iPad itself. To stay protected, look for PCI-certified, encrypted card swipers.

 

 

Posted in Best Practices for Merchants, Mobile Point of Sale, Point of Sale Tagged with: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

August 27th, 2014 by Elma Jane

Backoff malware that has attacked point of sale systems at hundreds of businesses may accelerate adoption of EMV chip and PIN cards and two-factor authentication as merchants look for ways to soften the next attack. Chip and PIN are a big thing, because it greatly diminishes the value of the information that can be trapped by this malware, said Trustwave, a security company that estimates about 600 businesses have been victims of the new malware. The malware uses infected websites to infiltrate the computing devices that host point of sale systems or are used to make payments, such as PCs, tablets and smartphones. Merchants can install software that monitors their payments systems for intrusions, but the thing is you can’t just have anti-virus programs and think you are safe. Credit card data is particularly vulnerable because the malware can steal data directly from the magnetic stripe or keystrokes used to make card payments.

The point of sale system is low-hanging fruit because a lot of businesses don’t own their own POS system. They rent them, or a small business may hire a third party to implement their own point of sale system. The Payment Card Industry Security Standards Council issued new guidance this month to address security for outsourced digital payments. EMV-chip cards, which are designed to deter counterfeiting, would gut the value of any stolen data. With this magnetic stripe data, the crooks can clone the card and sell it on the black market. With chip and PIN, the data changes for each transaction, so each transaction is unique. Even if the malware grabs the data, there not a lot the crooks can do with it. The EMV transition in the U.S. has recently accelerated, driven in part by recent highprofile data breaches. Even with that momentum, the U.S. may still take longer than the card networks’ October 2015 deadline to fully shift to chip-card acceptance.

EMV does not by itself mitigate the threat of breaches. Two-factor authentication, or the use of a second channel or computing device to authorize a transaction, will likely share in the boost in investment stemming from data security concerns. The continued compromise of point of sale merchants through a variety of vectors, including malware such as Backoff, will motivate the implementation among merchants of stronger authentication to prevent unauthorized access to card data.

Backoff has garnered a lot of attention, including a warning from the U.S. government, but it’s not the only malware targeting payment card data. It is not the types of threats which are new, but rather the frequency with which they are occurring which has put merchants on their heels. There is also an acute need to educate small merchants on both the threats and respective mitigation techniques.. The heightened alert over data vulnerability should boost the card networks’ plans to replace account numbers with substitute tokens to protect digital payments. Tokens would not necessarily stop crooks from infiltrating point of sale systems, but like EMV technology, they would limit the value of the stolen data. There are two sides to the equation, the issuers and the merchants. To the extent we see both sides adopt tokenization, you will see fewer breaches and they will be less severe because the crooks will be getting a token instead of card data.

Posted in Best Practices for Merchants, Credit Card Security, Payment Card Industry PCI Security, Point of Sale Tagged with: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

May 23rd, 2014 by Elma Jane

Before making a purchase, there are several devices that consumers may use to help them make a decision: Use a specific store’s mobile app on their smartphones. Visit the store’s website on a tablet or computer, or just pick up the phone and call customer service to ask a question. Whatever the case, omnichannel is an important buzzword for merchants.

Here are ways to ensure a seamless and secure retail experience to turn browsers into loyal buyers.

Ensure Channels Work Together

Even in historically single-channel retail sectors such as grocery, more than half of customers now use two or more channels before completing a purchase, shown in a recent study. Retailers must therefore offer both traditional and digital channels. However, before investing in the latest mobile-optimized website feature or app, retailers should learn how existing online and physical channels can together enhance the customer experience. What customers value most is not the number of channels offered, but how these channels support each other.

A merchant’s website might encourage visitors to take advantage of a special event in-store, while sales assistants on the floor can use Wi-Fi enabled tablets to access additional product information.

Help Customers Find What They Want

With Internet access ubiquitous, cost-conscious customers are just a click away from being able to compare prices and find special offers. Many take out their smartphone or tablet in stores to compare prices, a trend called Showrooming.

Online retailers can take advantage of this trend by encouraging shoppers to compare prices in-store using a mobile app. In-store retailers, on the other hand, could provide greater value through targeted offers, price match guarantees, expert advice, convenient delivery choices and personalized customer care.

Optimize The Checkout Experience

Businesses must be sure to have a quick, streamlined checkout process once they have converted an online browser into a customer or else they risk facing shopping cart abandonment. This can be done in a few steps:

1. Assess how the checkout experience can be customized for its customers. Keep the mandatory information required from new or first-time online or mobile shoppers to a minimum and shorten the process for returning customers by securely storing their payment details and other personal information.

2. Develop a dedicated mobile app or other innovative functions that can increase long-term satisfaction and loyalty.

3. Test different payment methods to find those that are most convenient for customers. These payment options may include paying with reward points, using a digital wallet or providing a digital offer or coupon at checkout. There is a balance to be found between having additional payment methods to meet customer expectations and choosing methods appropriate to a merchant’s business model.

4. Establish a one-click online checkout process. Chase for example, is currently developing a Chase Wallet and Quick Checkout solution. The Chase Wallet will allow customers to store and access their Chase cards and ultimately, any branded card for a quick checkout. It will also update Chase-branded cards when a customer replaces an existing card and use tokenization to securely process payments with select merchants.

Merchants also face the challenge of ensuring that the online and in-store checkout experience is secure, while at the same time eliminating as many false positives as possible. False positives are a hindrance to any business as they may reduce sales, increase chargebacks and frustrate customers. A quick-checkout solution may help reduce false positives because customer information is automatically populated rather than manually keyed into the checkout page.

Acquirers should also work with online retailers to provide a conditional approval code for a transaction. This code allows the fulfillment process to move forward while authentication is taking place. The additional time for a thorough authentication also helps reduce the number of false positives.

Use Data to Build Loyalty

Customers will likely return to a retailer if product marketing reflects their past purchases or interests. Therefore, taking advantage of data including a customer’s purchasing history, loyalty, behavior or social media interests may help retailers to better understand their customers as well as personalize their shopping experience.

According to a study released in March 2013, Chase Paymentech found that 32 percent of merchants use their payment data to help craft their multi-channel sales strategy and 42 percent use it to improve the online customer experience. In addition, further analysis of payment methods, chargeback rates, fraud rates and authorization rates may improve the customer shopping experience and  drive overall profitability.

 

Posted in Best Practices for Merchants Tagged with: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

May 21st, 2014 by Elma Jane

Mobile credit card processing is way cheaper than traditional point-of-sale (POS) systems. Accepting credit cards using mobile devices is stressful, not to mention a hassle to set up  and customers would never dare compromise security by saving or swiping their credit cards on a mobile device. Some of the many myths surrounding mobile payments, which allow merchants to process credit card payments using smartphones and tablets. Merchants process payments using a physical credit card reader attached to a mobile device or by scanning previously stored credit card information from a mobile app, as is the case with mobile wallets. Benefits include convenience, a streamlined POS system and access to a breadth of business opportunities based on collected consumer data. Nevertheless, mobile payments as a whole remains a hotly debated topic among retailers, customers and industry experts alike.

Although mobile payment adoption has been slow, consumers are steadily shifting their preferences as an increasing number of merchants implement mobile payment technologies (made easier and more accessible by major mobile payment players such as Square and PayPal). To stay competitive, it’s more important than ever for small businesses to stay current and understand where mobile payment technology is heading.

If you’re considering adopting mobile payments or are simply curious about the technology, here are mobile payment myths that you may have heard, but are completely untrue. 

All rates are conveniently the same. Thanks to the marketing of big players like Square and PayPal – which are not actually credit card processors, but aggregators rates can vary widely and significantly. For instance, consider that the average debit rate is 1.35 percent. Square’s is 2.75 percent and PayPal Here’s is 2.7 percent, so customers will have to pay an additional 1.41 percent and 1.35 percent, respectively, using these two services. Some cards also get charged well over 4 percent, such as foreign rewards cards. These companies profit & mobile customers lose. Always read the fine print.

Credit card information is stored on my mobile device after a transaction. Good mobile developers do not store any critical information on the device. That information should only be transferred through an encrypted, secure handshake between the application and the processor. No information should be stored or left hanging around following the transaction.

I already have a POS system – the hassle isn’t worth it. Mobile payments offer more flexibility to reach the customer than ever before. No longer are sales people tied to a cash register and counters to finish the sale. That flexibility can mean the difference between revenue and a lost sale. Mobile payments also have the latest technology to track sales, log revenue, fight chargebacks, and analyze performance quickly and easily.

If we build it, they will come. Many wallet providers believe that if you simply build a new mobile payment method into the phones, consumers will adopt it as their new wallet.   This includes proponents of NFC technology, QR codes, Bluetooth and other technologies, but given very few merchants have the POS systems to accept these new types of technologies, consumers have not adopted. Currently, only 6.6 percent of merchants can accept NFC, and even less for QR codes or BLE technology, hence the extremely slow adoption rate.  Simply put, the new solutions are NOT convenient, and do not replace consumers’ existing wallets, not even close.

It raises the risk of fraud. Fraud’s always a concern. However, since data isn’t stored on the device for Square and others, the data is stored on their servers, the risk is lessened. For example, there’s no need for you to fear one of your employees walking out with your tablet and downloading all of your customers’ info from the tablet. There’s also no heightened fraud risk for data loss if a tablet or mobile device is ever sold.

Mobile processing apps are error-free. Data corruption glitches do happen on wireless mobile devices. A merchant using mobile credit card processing apps needs to be more diligent to review their mobile processing transactions. Mobile technology is fantastic when it works.

Mobile wallets are about to happen. They aren’t about to happen, especially in developed markets like the U.S. It took 60 years to put in the banking infrastructure we have today and it will take years for mobile wallets to achieve critical mass here.

Setup is difficult and complicated. Setting up usually just involves downloading the vendor’s app and following the necessary steps to get the hardware and software up and running. The beauty of modern payment solutions is that like most mobile apps, they are built to be user-friendly and intuitive so merchants would have little trouble setting them up. Most mobile payment providers offer customer support as well, so you can always give them a call in the unlikely event that you have trouble setting up the system.

The biggest business opportunity in the mobile payments space is in developed markets. While most investments and activity in the Mobile Point of Sale space take place today in developed markets (North America and Western Europe), the largest opportunity is actually in emerging markets where most merchants are informal and by definition can’t get a merchant account to accept card payments. Credit and debit card penetration is higher in developed markets, but informal merchants account for the majority of payments volume in emerging markets and all those transactions are conducted in cash today.

Wireless devices are unreliable. Reliability is very often brought up as I think many businesses are wary of fully wireless setups. I think this is partly justified, but very easily mitigated, for example with a separate Wi-Fi network solely for point of sale and payments. With the right device, network equipment, software and card processor, reliability shouldn’t be an issue.

Posted in Best Practices for Merchants, Mobile Payments, Mobile Point of Sale, Smartphone Tagged with: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,