A simple guide to contactless readers.

If the coronavirus pandemic has taught merchants anything, it may be that, regardless of size, businesses should adopt contactless payments. The increased emphasis on hygiene, coupled with consumers’ love of speed and convenience, has made offering this payment choice a virtual no-brainer. But what exactly are contactless payments, and how easy is it to incorporate them into your business?

Touchless payments: How they work.

As a consumer, chances are good that you yourself are one of the millions of shoppers who have paid for merchandise or services by tapping a credit card or waving your smartphone or wearable device near a merchant’s contactless card reader. The transaction was probably so fast and seamless that you scarcely batted an eye; in fact, you may never have stopped to think about what was going on behind the scenes. Now that you are contemplating incorporating touchless payment technology into your retail operations, it’s time to take a more in-depth look at this popular payment method.

Contactless payments take place by virtue of something called near-frequency communication (NFC) technology that is built into both the merchant’s card reader and the customer’s smartphone or wearable device. NFC, an evolution of the radio frequency identification (RFID) technology that has been around for decades in applications like keyless entry cards for hotel rooms, is a proximity-based communication standard that facilitates a touchless “handshake” between a card reader and the customer’s device. Once the digital dialogue begins, information can be securely transmitted within seconds but only if the two pieces of hardware are within a few centimeters of each other.

The other important component in contactless payments is the digital wallet. All modern smartphones come with this application already built-in. All the consumer needs to do is to load the wallet with their credit, debit, or loyalty card information. The data is then securely stored in the repository. When the time comes for a shopper to make a purchase, they simply open the digital wallet, choose their payment method, authenticate their identity with a fingerprint, PIN, or face ID, and place their phone or wearable device near the merchant’s reader. Within just a few seconds, their information is transmitted and analyzed, with a response of payment acceptance or declination sent back to the merchant’s contactless card reader.

The advantages of contactless payments.

As with any innovation, adopting touchless payment equipment may seem a bit daunting. What’s more, our turbulent economic conditions may be causing you to wonder if switching over is worth the expense. Here are just some of the reasons why businesses should adopt contactless payments.

• Transactions are quick. How often have your checkout lines been bottlenecked when a customer seemingly spent an eternity fumbling for change or searching for the right credit card? With contactless payments, people can now quickly use their phone, watch, or fitness device — pieces of equipment they always have within easy reach. With just a tap or a wave, an entire transaction can be completed.
• Security remains high. Thanks to the encryption in the digital wallet and the tokenization protocols that turn all card numbers into random strings of characters and digits, both consumers and merchants can rest easy knowing that sensitive cardholder information is not easily accessible to hackers.
• Payments are more hygienic. Even though we are now reasonably sure that the coronavirus is not primarily spread by touching surfaces, its presence over the past few years has emphasized the importance of staying away from potentially contaminated areas. That includes germ-ridden cash and touchpads that may not have been cleaned in recent memory. Contactless payments are safer by default. What’s more, offering them to your customers shows them that you care about their well-being. 
• The technology is affordable. Ask your merchant services provider how much it will cost to upgrade and you just might learn that you already have everything you need. Even if you don’t, the hardware will not cost you an arm and a leg.
• It’s easy to incorporate into your checkout process. Contactless tech is already familiar to most people, including your staff. In just a few minutes, you and your team can be up and running.
• Adding contactless capabilities will not mean you need to sacrifice payment choices. In fact, you can continue to offer the same payment options, including accepting credit, debit, and EBT cards, recurring billing, international payments with multi-currency conversion, and even cryptocurrency.

Considering all of the benefits your business could realize simply by implementing one change, there seems to be little reason to hesitate for one minute longer.

Contactless payments are the latest iteration of a type of technology that has been used for many years. If you put it to work for your store, you will soon come to see the added efficiency, security, and customer-friendly features that come along with it.