Top Mobile Payment Systems for Retailers
by Tim Parker
Whether you sell your goods away from the store where you don't have access to your merchant account system, or just want to offer your customers the ease of paying with their phone, mobile payment systems are the answer. Here's an overview of the top options available to you today.
Image source: Photospin.com
The easier you make it for your customers to do business with you, the more likely they are to consider you first when they need something. According to Pew Research, 90% of Americans own a cell phone, 64% own a smartphone, and 57% use it for online banking. Your smartphone is likely more important to you than a wallet or anything else you would carry with you, according to research.
All of those facts illustrate why companies like Apple, Google, and numerous startups are so interested in mobile payments. It has not yet caught on en masse but it’s coming.
A quick search reveals plenty of options. Which should you choose?
Using a mobile device to process payments isn’t new. Many companies have offered the technology for years. The “new” technology involves consumers using their phones in place of a credit card. If you’re not ready for the latter, here are some options to accept credit cards using your smartphone.
PayPal Here- A lot of companies have fallen victim to cybercrime. Despite the widespread attempts to infiltrate PayPal’s systems, it hasn’t happened. This is a company that has earned your trust. PayPal requires you to have a PayPal account and a small credit card reader that plugs into your smartphone. Download the app, and you’re in business. No monthly fees and 2.7% per swipe.
Square- Hats off to Square’s marketing team. In large part, when people think of scanning credit cards with smartphones, they think of Square. You’ve probably seen the commercials and know the brand. Like PayPal, simply plug a reader into your phone, download the app, and you’re set to go for only 2.75% per swipe.
Square is even ready for the switch to EMV and NFC technology. In the Fall of 2015, Square will ship its contactless reader.
Intuit GoPayment- If you use QuickBooks, and there’s a good chance that you do, look at Intuit GoPayment. You get the card reader and the app for free and swipe rates are 1.75% plus 25 cents if you pay the $19.95 per month fee or 2.4% plus 25 cents without the monthly fee.
Amazon Local Register- You may not know that Amazon has a mobile payment service. Swipe fees are lower than PayPal and Square at 2.5% but you have to purchase the card reader for $10. However, Amazon gives you a $10 new account credit making the card reader essentially free.
If you’re just now looking to get into mobile payments, the above options work, but from a technology perspective, they’re old. If you don’t want to get into contactless options, go with Square until the others have an EMV card reading device or take your chances with a third party EMV reader that hooks into a computer or mobile device.
But let’s talk contactless! Customers simply hold their phone or mobile device over a contactless reader and the payment is complete. It’s that fast—and the more tech savvy consumer is already using it and wants to use it more. There are two systems worth talking about.
Apple Pay- Apple knows how to market and it has the money to do it. If you’re even a little techie, or you watch TV, you’ve heard of Apple Pay. A customer loads their card into Apple’s payment app. When they visit a store that accepts Apple Pay, they simply authenticate the payment with their fingerprint, hold their device over the payment terminal and transaction is done. All you have to do is have a payment terminal that is NFC enabled and you have everything you need. NFC enabled terminals are as little as $250.
Signing up for Apple Pay is easy and free. All you do is contact your payment provider and they’ll do the rest. Apple Pay doesn’t charge you anything so whatever you were paying in credit card fees before you’ll pay the same with Apple Pay.
Contactless payment systems are more secure. Apple Pay assigns a unique number to your transaction instead of transmitting your card number—“Tokenization” in geek speak. This number is used only once so even if a cyber thief got the number, there’s nothing they can do with it.
Google Wallet- Google Wallet is Google’s mobile payment system. Enter your cards into the app, and you’re set to accept payments. Google Wallet is more geared towards e-commerce but works just fine with NFC terminals in your brick and mortar location. As soon as Android Pay is available to the masses, it will better compete with Apple Pay—likely being accepted everywhere consumers can use Apple Pay.
Samsung Pay- Samsung recently released its beta version of Samsung Pay, a payment platform to compete with Apple and Google. At the time of this article, it was only available to about 1,000 people in it’s home country of South Korea but early reports are positive.
You’re probably familiar with the switch to EMV technology and how credit card processors are pretty much requiring you to switch to new payment terminals or risk holding all liability for fraudulent transactions. While you’re switching spend a few extra dollars and buy a terminal that allows for NFC (mobile) payments. It’s the perfect time and you’ll be positioned to take advantage of what will surely take the place of the wallet.
Copyright 2015 Attard Communications, Inc. All rights reserved. May not be reprinted or republished without permission.
Cathy is a staff writer and digital media producer at Business Know-How and a graduate student in the Stony Brook Southampton MFA program for writing and digital media.