- Simplifying and speeding up the checkout process can have a big impact on the customer experience
- Businesses should be implementing fast, secure, and convenient ways to accept cashless payments
- QR code technology offers enhanced security, increased speed, and simplified payment processing
Cashless payments come in many different forms, including credit and debit cards, NFC tap-to-pay chip cards, e-transfers, digital wallet apps on smartphones, and more. As consumer demand for these types of cashless payments increases, businesses need to find ways to streamline the transaction process and ensure security in order to deliver a smooth, fast, and simple customer payment processing experience. QR code technology presents a unique opportunity to help businesses achieve those goals, but how do QR code payments work?
It might surprise you to learn that the square-shaped, pixelated, black-and-white icons you’ve been seeing on product labels, in promotional flyers, on in-store displays, and on outdoor signage have actually been around for nearly 30 years. Known as QR or ‘Quick Response’ codes, they were originally designed as faster, more powerful barcodes for use in manufacturing, as they could store significantly more data in them than a traditional line-style barcode. However, it quickly became apparent that the potential uses of QR codes extended far beyond manufacturing and they started to appear in areas of marketing, communications, technical service, customer support, and even in the payment processing industry.
Today, QR codes have many uses, such as:
- Store contact information for quick access when customers need support or technical service
- Link to online resources such as owner’s manuals, how-to videos, and product catalogues
- Access online forms to submit personal details for contests, promotions, or event registrations
- Verification of identity and proof of important personal information such as vaccination status
- Rapidly access online payment portals for secure authorization and transaction processing
This is just a small sample of what QR codes can be used for, and you can easily see why they’ve exploded in popularity in recent years thanks to their ability to simplify and automate many types of data-entry tasks. For example, rather than manually typing in a web address, which takes time and can easily lead to typos, QR codes eliminate potential errors and instantly access the correct online destination. Simply scan the code with your smartphone or connected tablet, you are automatically directed exactly where you need to go.
When it comes to payment processing, customers want to be presented with a fast, efficient, and secure way to submit their payment details and complete their transaction, and QR codes can provide your business with exactly that. So, how exactly do QR codes work in practice, and what do businesses need to know about them? The answer is actually quite simple, but there are definitely a few key elements that are important to keep in mind when choosing how to move ahead with QR code payments for your business.
How do QR Code Payments Work?
Simply put, QR codes are a digital way for customers to interact with your point-of-sale systems directly from their smartphone. Using the camera app on their smartphones, customers will scan your QR code when it’s time to make a payment, tap on the popup link that appears, and their device will instantly connect to your online payment form, also known as a virtual terminal. From there, customers will be able to choose from a selection of payment methods, including credit or debit cards and digital wallet apps like Apple Pay or Google Pay. Once the customer selects their preferred payment method, they will then be prompted to confirm and authorize their payment, thereby completing the transaction and moving the funds from their account over to the merchant’s account.
In essence, QR codes temporarily load your virtual point-of-sale solution onto the customers’ smartphone, and the entire payment process takes place digitally, with receipts and confirmations delivered instantaneously to the customers preferred email account. There is no fumbling through wallets or purses for credit or debit cards, no physical contact with checkout keypads or POS touchscreens that need to be sanitized, and no printed receipts that can be lost or misplaced. It’s a simple, efficient, and secure payment process that speeds up transactions for the benefit of customers and merchants alike.
What are the Advantages of Accepting QR Code Payments?
Simple and Cost-Effective Setup
One major advantage that QR code payments and virtual terminals have is that they require virtually zero investment in POS hardware or other equipment. You don’t need a standalone point-of-sale station or expensive business computer system to get started accepting QR code payments. Essentially, all you need is a smartphone, connected tablet, or laptop. From your device, you can manage and configure the digital payment portal that customers will access by scanning your QR code.
Faster Checkout Experience
Because customers don’t need to pull out their physical payment card, paying for their purchases using a QR code is faster than checking out using a traditional POS system. With just a few taps on the screen of their smartphone, the transaction is authorized and they can quickly be on their way. Customers will appreciate the efficiency of your checkout process, and your employees productivity will increase as they can assist more customers with their purchases in less time.
Increased Transaction Security
QR codes are a very secure and safe way to handle payment processing, as customer payment details are not stored locally on your POS or business computer. All the data entered from the customers’ smartphone into your online virtual terminal payment portal is encrypted and transmitted securely directly from their device to the payment processor for authorization and approval. Account details, credit card numbers, and personal information is not shared or stored during the transaction process.
Fewer Physical Touchpoints
Contactless payments are rapidly becoming the standard methods of payment around the world, especially thanks to the last two+ years of the COVID-19 pandemic. Contactless payments like QR codes and virtual terminals are more sanitary and hygienic than physical credit cards, debit cards, and cash, and are now preferred by many customers as they have become accustomed to these new types of payment technology. QR codes also have the advantage of digitally sending proof of transaction documents and receipts directly to customers, eliminating the frustration of lost or missing receipts.
Accessible From Virtually Any Location
Unlike businesses who require payment processing to be done at their in-store point-of-sale system, virtual terminals on smartphones can be used anywhere there is an accessible WiFi or cellular LTE network. All you need is a copy of your QR code for the customer to scan with their device, and the rest of the transaction process is all done on their device. This is particularly valuable for contractors, on-site service providers, food trucks, pop-up kiosks, and other types of mobile businesses who need a flexible and portable payment solution that can go anywhere they need it to.
Ideal For Unattended Payment Applications
There are many types of unattended payment kiosks, vending machines, and other types of applications where QR code payments make a lot of sense. Rather than install and maintain a physical payment terminal on these types of unattended terminals, businesses can instead opt for a QR code linked to your online payment portal for customers to complete their payments with ease and simplicity.
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Making the decision to start accepting QR code payments is certainly an easy one, as the advantages and benefits can be quite significant. However, to implement them properly and for maximum impact, it’s essential to work with a merchant services provider who understands the nuances of QR code payments and how to optimize them specifically for your business. MONEXgroup leads the payment processing industry with expert customer service and support that has the knowledge and experience to make QR code payments work for you.
Our team of payment processing professionals will work directly with you to configure and set up your virtual terminal and QR code payment solution to provide a fast, secure, reliable, and intuitive customer experience. In addition, MONEXgroup’s comprehensive suite of payment processing technologies allows us to provide our clients with integrated POS systems for in-store, online e-commerce, and mobile payment processing applications that work seamlessly with QR code payments. We are your all-in-one merchant services provider, with state-of-the-art payment processing tools and unparalleled customer and technical support to help businesses succeed and thrive in even the most competitive industries and markets.
Reach out to MONEXgroup today to find out how QR code payment technology can benefit your business!
Author: Layal Scheirich, Head of Sales at MONEXgroup
Bio: With 18 years of experience in payment processing and merchant services, Layal has seen in-store POS technology evolve from its humble beginnings to contactless, unattended, mobile and online alternatives. Today, Layal is an inspiration to the MONEXgroup’s team and a go-to source of information related to payment processing. She is enthusiastic to share her knowledge with audiences interested in cutting-edge technologies available today, such as unattended payment for self-serve kiosks, e-commerce online payment gateways, virtual terminals, and contactless and mobile payment solutions.
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