The why and how of accepting contactless payments [Business Guide].

Business tips
Joshua Griffin


Contactless payments have exploded in popularity on a global scale and are now starting to gain traction in the United States as well. Businesses need to be ready to accommodate changing consumer tastes as more contactless cards become available and a growing number of young people start relying on their phones to make payments. Here’s what you need to know to bring your business up to speed.

Contactless basics.

Customers make contactless payments using either mobile devices, mobile wallets, or credit cards equipped with near-field communication (NFC) contactless technology. This adds “tapping” to the familiar payment actions of swiping a magnetic stripe card or dipping a chip card.

In the United States, mobile wallet adoption is more widespread than the use of contactless cards. The ease and convenience of Apple Pay, Android Pay, and Samsung Pay make mobile wallets popular options, especially among younger consumers. However, major credit card issuers are rolling out more contactless cards, which could lead to increased use across demographics.

The contactless process.

Contactless payments are quick and straightforward. To complete a transaction, customers either tap a contactless card on, or hold, a mobile device over an NFC-equipped point-of-sale (POS) terminal. Authorization occurs in a fraction of a second, and the payment is accepted.

Getting the right equipment.

A credit card terminal or card reader with NFC contactless technology is all you need to accept contactless payments. These devices are fairly inexpensive and either replace your existing terminal or integrate with your POS system. Just plug in the equipment, follow the setup instructions, and you’re good to go.

To give yourself and your customers more flexibility, look into a wireless card reader. These devices don’t require hardwired connections and can be used to accept payments anywhere. You can purchase a wireless card reader as a standalone unit or a model designed to plug into your mobile device.

All contactless payments made through a wired or wireless credit card reader count as card-present transactions, so you won’t have to deal with any extra processing fees.

The benefits of going contactless. 

It’s only natural to wonder if investing in new POS equipment is worth the cost. The hardware can more than pay for itself when you consider the benefits for your business:

The convenience of contactless payments is driving more people to start moving away from cash and traditional credit cards. Twenty-nine percent of U.S. consumers are eagerly waiting for the day when they can use their smartphones to make payments all the time and contactless cards are becoming easier to obtain. Investing in contactless payment technology now puts your business ahead of the curve and equips you to offer the payment options customers want.

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