In your research for the right merchant services provider for your startup, you have probably come across terms like “mobile payment” and “near-field communication (NFC)” and wondered what potential benefits these technologies might have for getting your business started off right.
Apple Pay was the first major mobile wallet to come to market in 2014, and adoption of mobile payment among both businesses and consumers has risen ever since. It is predicted that the transaction volume of mobile payment could soar over $500 billion by 2020! Startup entrepreneurs know better than anyone else that they must adapt to survive.
Let’s talk about what mobile payment means and how it works.
What Is Mobile Payment?
The story of mobile payment, also called “contactless payment,” goes something like this:
Your customer walks up to the checkout, product in hand. The customer service agent rings up their purchase and prompts the customer to pay. Instead of fiddling through their purse or digging into their wallet for cash or card, the customer simply takes their smartphone (which is already in their hand) and holds it over the reader. In just one second, the amount is paid. The customer is on her way back to whatever they were doing before in little more than a heartbeat.
In short, mobile payment allows your customer to pay with their smartphone.
In short, mobile payment allows your customers to pay with their smartphone.
Mobile payment is the most technologically advanced, convenient, and secure form of payment currently available for startups.
How Does Mobile Payment Work?
On the customer side, mobile payment is as easy as downloading a mobile wallet app. The top 3 include:
- Apple Pay – With Apple Pay, the customer simply enters their credit card info, and they’re ready to go! At point-of-purchase, all they have to do is hold their finger on the touch ID button while holding their phone over the reader to pay.
- Android Pay – Android Pay works just like Apple, except the app requires that you have it open on the smartphone in order to pay. Additionally, there is no touch ID, but the secure lock screen must be open to open the app.
- Samsung Pay – Just like Android, Samsung Pay requires the app to be open.
The business side is a little more complicated as it requires an integrated point-of-sale (POS) device. Fortunately, the complexity of adding a mobile payment device to your system is the responsibility of your merchant services provider. At Cornerstone Credit Services, we will come onsite to your startup for installation as well as to train your staff.
Mobile payment is enabled by near-field communication (NFC). Near-field communication allows the customer’s smartphone and the point-of-sale device to share encrypted credit card information wirelessly when they are within 2 inches or less proximity.
Mobile payment requires multiple levels of encryption. It is currently as secure as EMV (chip) payment, which is more secure than payment using a card with a magnetic strip. With the additional security on the customer side required by Apple Pay and Android Pay (touch ID and lock screen), mobile payment is arguably more secure than EMV.
If you think mobile payment is right for your startup, reach out! We can discuss your options with you as well as address any questions you may have. For entrepreneurs who are not working with us and would like to get started with a merchant services provider (or switch!), we are currently offering free, local coffee or pizza to customers who compare rates with us or give us a try! It doesn’t get any better than that.