Why Tap & Pay Systems are Becoming a Part of the New Norm

We have all now become very familiar with the experience of pulling up to a drive-thru restaurant window, rolling down our own vehicle window and being greeted by a credit card/mobile phone payment terminal attached to the end of a long stick. In Canada, early on in the pandemic, the novelty was to use a hockey stick as the delivery mechanism with a nod to the beloved national game of the north. All we, the consumer, need to do, is hover our card or phone over the tap and pay terminal to complete our transaction and then wait patiently for our breakfast, lunch, dinner or late-night snack also delivered at arm’s length. The reason for the stick is, of course, to maintain a safe social distance from the restaurant drive-thru staff as a means to keeping everyone safe in the midst of a global pandemic.

Contactless tap pay systems pre-date the pandemic, but have become increasingly popular for business owners and consumers alike, as awareness of the importance of limiting the number of items we have to physically touch in public has grown incrementally. While some people still prefer to use cash or to swipe/insert their card and enter a pin number, many others have come to realize and appreciate the benefits associated with tap to pay. MasterCard reported in 2020, 8 in 10 of their global customers used contactless payments.

While the pandemic has increased the use of tap & pay systems, their popularity was already on the upswing for a number of reasons for business owners and consumers alike.

Health and Safety

According to a recent GetApp survey of nearly 1,000 U.S. consumers, 65% of customers say that contactless services align with their current health and safety priorities. Further, more than a third of customers (34%) are already saying the availability of contactless services will be important even after the pandemic is over. This is simply the preferred method to which consumers have become accustomed and will no doubt be demanding from retail shops, restaurants and others who want to secure their business.

As discussed, tap and pay solutions can both increase the distance between which retail staff and customers interact or remove the need for this interaction altogether in certain situations. Contactless tap to pay terminals or unattended kiosks are increasingly being made available to consumers in a wide variety of retail scenarios from restaurants, gas stations and laundromats to grocery, clothing and home improvement stores. Retail staff can be reduced or reassigned to more customer service, customer experience or revenue generation related roles. Progressive businesses use tap & pay systems to help make customers feel both safer and better supported throughout their shopping experience.

Most delivery services have likewise moved to a contactless model where payments are processed online in advance or are completed at the customer’s door via mobile tap to pay terminals. Here too, consumers are given an added sense of security by ensuring limited interaction with delivery people who are making deliveries to multiple locations per day.

Business owners must also naturally consider the health and safety of their staff. In addition to not wanting anyone to get sick, losing staff unexpectedly to illness, or even worse, to a breakout can do serious damage to a business and its reputation. From this perspective, a tap to pay system is a necessary, proactive measure all responsible operators should implement.

Speed and Efficiency

The difference in the time it takes to process a customer’s tap and pay purchase vs. having them swipe or insert and then enter a pin number for a traditional credit card transaction or the process involved with taking cash and having to make change is obvious. While it may not seem like much time saved on a transaction-by-transaction basis, the cumulative time-saving effect of adopting a tap pay system can be significant over time in a high-volume business. Simply put, faster processing means more transactions and more revenue.

A quicker and more efficient purchasing process further benefits customers who all seek immediate gratification and place a high value on saving their own time.

The literal ease of tapping leads many consumers to make more and larger purchases. For some, it just feels less like spending money.

Payment Flexibility

Tap to pay systems use wireless RFID (radio frequency identification) and NFC (near field communication) to enable consumers to make secure payments using their debit or credit cards, mobile phones, wearable technology devices or fobs in some specialized cases, which have been equipped with specialized RFID chips. Increasingly tech savvy consumers appreciate the ability to choose which device they can use to make purchases. They are, in turn, more likely to choose how much they buy based on the range of options available to them. Conversely, businesses not offering a full range of options may find customers walking right past their storefronts in favour of more flexible competitors.

Payment flexibility also extends beyond devices to the types of digital payments accepted, which may include EMV credit cards (Visa, MasterCard, American Express, Europay), bank debit cards, mobile wallets such as Apple Pay, Google Pay, Android Pay, UnionPay or Discover cards. Other forms of tap to pay digital currency are no doubt on the horizon as the world becomes more digital in general. Multiple payment types likewise increase the potential for higher volume, higher value purchases and increased revenue.

Banking and Transaction Fee Incentives

In an effort to promote tap & pay systems as purchases are processed quicker and more effectively, many banks are offering cash back and other financial incentives to customers and businesses who move to this faster and more efficient model.

For business owners, there is generally no difference in transaction fees for contactless payments vs. traditional credit card payments; removing any financial barrier to making a switch or adding tap and pay as an option for your customers.

Loyalty and Discount/Coupon Integration

Most tap and pay solutions can be synced with existing loyalty programs so there is no need to swipe or tap a second card or device. Any purchase rewards are calculated and added automatically to the customer’s loyalty account.

Similarly, coupons and promotional discounts can be incorporated into the tap and pay process, so again there is no need for any additional interaction between customers and staff.

These are both additional examples of how tap pay services remove steps, enhance efficiency, and simplify the overall user experience, which leads to happier, loyal, repeat customers.

Privacy and Security

Privacy and personal data security are top of mind for all consumers. Tap and pay solutions do, in fact, represent a more private and secure way of making and processing payments.

First and foremost, tap to pay removes the need for customers to remember or insecurely store and then enter what are all too often insecure four or five-digit pin numbers. While we all know it is advisable to create and maintain a unique, non-identifiable pin, we’ve heard stories or know of people who use their date of birth, phone number or an even “trickier” combination of digits like 1-2-3-4.

Secondly, consumers who tap to purchase are not required to check over their shoulder or shield themselves as they input their pin code, which, by its very nature, is not the most secure process in crowded public situations. This is the very reason most pin terminals come equipped with guards to deter curious eyes.

Modern tap and pay systems have been designed and developed with the highest levels of PCI (Payment Card Industry) compliance and wireless communication security to avoid breaches or data theft. In fact, the chip technology in tap-to-pay systems is actually more secure and reliable with built-in fraud protection. Business owners can rest assured standards compliance is an ongoing process as there are those who are continually looking for holes and ways to access personal and financial data. Reputable payment processors simply cannot afford and will not be allowed to operate if there is any risk of data or technology-related security issues.

In the event of a fraudulent tap and pay purchase occurring, most issuing financial institutions are protecting contactless payments in any case.

Enhanced security means businesses get paid faster and have to deal with fewer disputes, which can be a waste of valuable time. In the event of a fraudulent tap and pay purchase actually occurring, most issuing financial institutions are protecting contactless payments in any case.

Time to Get on Board

There are few, if any, downsides to adding tap and pay options to your business, particularly if you already accept credit and debit cards. Some customers will still ask for cash or traditional card-based alternatives, as any new technology takes time to become fully accepted and trusted. However, the benefits outlined here for customers and businesses in terms of health and safety, convenience, flexibility, potential cost savings, enhanced security and a better overall user experience are certainly being realized by a growing number of companies. Moreover, most consumers understandably now expect and demand safer, quicker, and more secure options.

Are you thinking about adding or upgrading to tap and pay options for your business? MONEXgroup has designed, developed, and implemented a wide variety of contactless tap & pay solutions for customers across North America. We would be happy to have one of our friendly staff members discuss your specific needs and answer any additional questions you may have about hardware, software or support services. Contact our payment processing experts today and let’s see how we can help.