If you own or manage a business and don’t know the definition of contactless payment, the key is in the words. “Contactless” payment is a way for consumers to pay for goods and services without using a traditional debit or credit card. Unlike typical debit and credit cards, contactless payment never touches the point of sale (POS) terminal.
When you make a purchase at your favorite retailer, you either swipe or insert your chip card into the POS terminal. The magnetic strip on your card contains your bank information, which enables the retailer to take the proper funds from your account. This magnetic strip was first used in 1950 and remains on major credit cards today. The issue with this magnetic strip is risk of fraud. When your bank information is stored on a magnetic strip, it makes it easy for hackers to steal your bank information and make fraudulent charges. Even with the evolution of chip cards, there is still a great risk of compromising your bank information, especially if retailers haven’t updated to chip card readers, and since cards still have magnetic strips.
So, technology experts developed contactless payment. You can pay for goods and services through a card, mobile devices, watches, and other wearable devices. It makes transactions quick and painless, for any business with the right equipment and display the ‘Wi-Fi’ symbol on their POS or terminal. If your business payment system does not show this symbol, or you are not sure about accepting Contactless Payments, talk to a local payment professional about getting new hardware.
How do contactless payments work?
Contactless payments operate on near field communication (NFC) technology. It uses radio frequency identification (RFID), and devices communicate with the payment reader when they are within centimeters of the POS terminal. When you tap or wave your card or device over the payment reader, payment information is transmitted through RFID. It is the same technology as toll tags, but with a limited distance from the reader.
What does my point of sale terminal need to accept Contactless payments?
Contactless payments can be made with credit cards, debit cards, gift cards, and various smartphone applications, such as Apple Pay, Google Wallet, Samsung Pay, etc.
Your point of sale equipment needs a type of reader for Contactless payments. And must be programmed properly so you get paid.
How do I get the equipment and software needed for Contactless payments?
Most businesses can buy anything online, BUT DON’T purchase payment devices and services on the web! Do you really want to put 85% of your profits in the hands of someone you can’t actually meet with or talk to in the future? Find a local payment expert in your area to work with. They typically have all the services and software needed and can give you hands on support now and later. If you have ever held on a 1-800-I-DONT-CARE phone line to a foreign country, then you can understand why you want someone local to depend on. They depend on your business for referrals, too, so they want to partner with you and your success.
Ken Givens has helped thousands of businesses reduce processing costs and upgrade payment systems since 1998. Please call 888-995-3995 for a free consultation.
This article compiled by Ken Givens, U.S. Merchant Payment Solutions, from webfx.com, creditcards.com, and Visa.com.