Contactless cards have been on the rise for the past few years and as far as tech has come, it can’t be denied that this is the best option for card payments. Being able to just tap your card against a machine for a near-instant payment is overall far better in terms of saving both your staff’s time and customers’ time.
That being said, it can still be improved. Here are a few things we can probably expect from contactless in the near future:
The Current Contactless Payments Statistics
Whilst contactless payments have yet to fully dominate global trade, they are on a definite rise. A recent infographic by VISA showed that 40% of in-person payments are now done through contactless means. Statistics on moneysupermarket.com‘s website note that from their surveys, 59% of people find the push to accept contactless as the main form of payment is overall a more efficient option.
There are many places in which this option is becoming the majority. In Canada, the figure for contactless payments is 75%.
This rise in such a short span of time is a notable change in how the world pays for things, with many countries’ economies going from a single digit percentage to becoming half or more of payments within the span of two years.
There are some areas in which contactless hasn’t taken full form, however. In Latin America as a whole, only 25% of payments are contactless.
Based on previous trends in marketing, there’s a two-year difference between a new technology’s introduction and most of the population accepting it as the standard. That said, it can be anticipated that contactless may make up the majority of payments as early as next year, or at least grow considerably.
Amazon will still push the boundaries
As is always the case with e-commerce, Amazon may be the one to dictate the new direction. Their latest idea is a self-service shop controlled by many cameras and sensors, with the shopper’s card being billed immediately upon leaving without wasting time on check outs or queues.
This kind of self-service could help revolutionise shopping of all kinds, and will most likely start with things that are readily available online but has the potential to grow to things like food. With strong security, this can work as a trustworthy system for business that will offer major changes to the industry, and save huge amounts of time for customers.
Terminals will finally be improved
When cards change, the terminals they use will too.
Despite the updates to POS terminals having been minimal ever since their introduction in the 80s, the changes in cards in the contactless age has finally warranted this area of technology to be improved. The terminal website myPOS has made strides in how payment transactions are made, allowing for contactless payments to be performed anywhere using portable terminals and apps. Expect this to catch on.
Even more people will adopt contactless payments
Despite the new innovations being made, fixing the flaws of the current system are just as important. In the UK, three million businesses have yet to use contactless and consider sticking purely to cash far more cost-effective, likely due to not wanting to spend money on implementing new technology, or fixing issues that cash just doesn’t have like machines not scanning.
Limiting payment options, however, is a bad move that can result in you getting far less profit than you potentially could, with businesses accepting contactless earning on average 10% more revenue. Alongside that, there are a lot more positives with contactless, like not needing to count money or worry about it being secure in-store.
Indeed, this isn’t a flaw in the function of contactless, but more something that people will become more educated on in the future. It’s important for more businesses to become aware of the benefits of contactless, and this will happen over time.
Improvements in Security
One thing that will need to be improved at the same rate as the technology itself is the security to protect it. Preventing fraud is always an essential focus, no matter what the payment option is. Along with the more traditional problems, there is the risk of wireless technology being used to scan your card and steal its assets without you knowing.
Having built in fingerprint sensors is a way many companies are countering this risk. Others focus on a large ID database, in which a customer’s payment ID will be temporarily accessed by the company so as to make the transaction more secure.
For some, a current flaw in the system is the limit for contactless cards being £30 for a single payment in the UK, though this is certain to increase in the future as both the popularity of contactless payments and the security behind them both increase.
The American Market
Despite the size and strength of America’s economy, contactless payments are an area they’re severely lagging behind in. An extremely large portion of shops still deal with only cash, with the others accepting more of a Swipe and Sign system.
Though some US companies are looking to expand on this area after seeing how it’s worked out for other countries, some work on America’s payment system will be needed for them to catch up. These requirements would include:
- Reduced stigma on alternative payment methods from consumers
- Encouragement by credit companies to issue these cards to more applicants.
- Shop owners to fully catch on
Contactless being overtaken?
Though it’s unlikely for the more standard debit card transaction to become obsolete in the near future, the use of it will help pave the way towards the popularity of contactless payments in places it’s yet to fully take off, such as the previous example, America. We should expect Chip and Pin to become the most popular before the landscape shifts to contactless.
Next, we should expect to see mobile payments rising, maybe even above contactless. Then, who knows!
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