Published On: August 11, 2017

Punching in one’s pin code to pay is rapidly becoming passé for Canadian consumers, and the world at large, with the rise of contactless payment technology. Canadians have been quick to adopt contactless payments using their Credit and Debit cards equipped with NFC technology that enable swift instantaneous payments. MasterCard’s patented “Tap & Go” term for the technology has become an everyday buzz phrase in the daily lives of Canadian consumers who absolutely love the newfound ability to make effortless purchases. Likewise business owners are delighted with resulting shortened queues and heightened efficiency at their stores.  To bring the technology to the next level, the major credit card and debit card networks are partnering with Canadian banks and popular mobile device platforms to allow cardholders to tap their Smartphone and pay even more conveniently via an app. Contactless payment is more than a trend – it’s intuitively better technology from a business and user perspective…it represents the future of how we conduct transactions.

How it works

With the tap and pay contactless technology, the branded terminology differs between the major players. For instance, Visa refers to their contactless technology as “payWave” while MasterCard coined the popular term “Tap & Go”. Regardless of the terminology, they ultimately work the same way and provide the same outstanding level of convenience. Both companies utilize an NFC chip embedded inside their respective cards which can transmit the cardholder’s information wirelessly, allowing them to “tap and go.”

The radio antenna embedded in the credit card allows for the tap and go technology to work seamlessly, as it sends radio frequencies to the terminal. Almost 100% of new credit cards come with this technology built-in, but customers can still make purchases with a signature or pin if they choose not to tap. One particular exception is if the total value of the purchase is over $100, in which case the customer has to insert their chip (Visa payWave and MasterCard Tap & Go).

How to Use

Performing a tap payment is pretty self-explanatory, all you need to do is tap or hover your credit / debit card / supported mobile device over the terminal and you will hear the verification sound from the terminal meaning the tap payment went through successfully. You will then see the screen confirming payment processing and voila… it’s done!

Why is Tap & Go Practical and Beneficial?

Some advantages of contactless payment for customers include:

The contactless card payment method is faster to use. In order for the customer to pay, all they have to do is wave their card over the RFID reader and anticipate the sign that says payment has been completed

  • Tap transactions’ average duration takes about 15 seconds. By comparison, magnetic strip card transactions take 25 seconds and cash takes 34 seconds. In today’s fast-paced world, every second counts!
  • Contactless cards utilize secure encryption standards. Triple DES encryption makes it virtually impossible to steal data
  • The contactless card never transmits your card number. Instead, the RFID chip within the card creates a unique number for the transaction
  • Consumers don’t need to worry about typing errors or forgetting their code
  • Retailers no longer have access to your credit card information
  • You are able to keep track of rewards via supported apps and use points for your purchases made in places like coffee shops
  • Convenient and quick checkout payments means reduced line ups, so customers can move on quicker with their lives

It’s no wonder why more and more Canadian consumers love the contactless technology and is their first choice as a daily payment option.

Some advantages of contactless payment for merchants include:

Gaining more customers as most people no longer carry cash and prefer using their Debit/Credit cards or mobile devices

  • Affordable and easy for merchants to set-up with trusted merchant service providers
  • Ease the line ups at checkout points and speed up the efficiency of the queue so merchants can increase their revenue
  • Enhance customer satisfaction resulting in greater repeat business
  • Less hassle to train staff on closing tills and balancing cash at night
  • Managers can focus on operations and coaching staff on other important skills than dealing with cash handling issues
  • Ease the checkout experience for customers
  • Streamlined payment processes reduce operating costs and improve operational efficiency
  • Increase customer spending by increasing frequency of purchases, as customers won’t shy away from a quick tap compared to a more involved alternative
  • Increased loyalty for customers who prefer paying with tap

The future of Contactless Payments

As contactless cards and mobile device payment applications are becoming the norm and preferred method of payment for merchants and customers in Canada, the market is embracing changes that coincide with the evolution.

For example, the Globe and Mail recently reported two restaurateurs in Ontario have actually made a bold decision to make it impossible for their customers to pay in cash, by only accepting credit or debit card forms of payment. The owners confidently reasoned that they will boost their operational efficiency by rejecting traditional cash. For starters it will eliminate the time-consuming task for their staff to count tills at closing, and thereby free up more time for coaching staff and ensuring the smoothness of the restaurant’s service. So far, their feedback from customers has been positive. According to the article, “in the second quarter of 2017, 39.5 per cent of payment transactions used tap and pay methods. That’s up from 30.86 per cent from the year before”.

This is just the beginning of the movement given the emergence of a vibrant Fintech industry pumping out so many exciting new technologies and apps that are being developed with NFC technology as a core component. We’ve already seen the first major breakthrough in mobile payments with Apple Pay’s successful launch and continued growth, plus the more recent launch of Android Pay in Canada.

A growing number of Canadian consumers are enjoying the convenience and ease of contactless payments. An investigative news piece reported by Global News discovered that out of 1,000 people being surveyed, 77 percent of respondents preferred to pay for purchases by debit or credit card, and 65 per cent said they rarely buy anything with cash anymore. When interviewing a correspondent for the article, she responded that “I keep cash in my wallet sometimes just for my kids. Anything else I don’t see why I would need it.”

What are the Benefits of Partnering with MONEXgroup in Terms of Contactless Technology?

MONEXgroup is a payment industry leader at the forefront of modern POS technology. Our mission and goal is not only to keep up with the latest trends, but to stay ahead of the curve. In terms of future payment technologies that we envision gaining prevalence, we strongly believe in the rapid rise of unattended payment solutions, particularly ones supporting contactless payment methods. Being the only North American company that’s able to offer a full-suite of unattended payment solutions including our groundbreaking Contactless Only payment kiosk system, we are proud to partner with petroleum industry suppliers, carwashes, academic institutions, and laundromats nationwide that are witnessing improved revenue and customer satisfaction.

What makes MONEXgroup a world-class leader in the contactless payment universe? We are the only merchant service company in Canada that integrates contactless only payment technology into any self-serve kiosk or vending machine with 100% PCI certification for Visa payWave, MasterCard Tap & Go, Interac Flash and Mobile Payments such as Apple Pay and Android Pay. This solution is currently deployed at Tire Inflators, Car Vacuum machines and Carwashes across Canada. But don’t just take our word for it… check out our videos!

When partnering with the number one payment processor in Canada; MONEXgroup will increase your efficiency and quality of service and lower the related costs. Request a Cost Comparison Analysis today.

Author: Lindsey Lu, Marketing Communication Specialist, MONEXgroup
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