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Why contactless payments are becoming business as usual for retail and more

March 23, 2021

Why contactless payments are becoming business as usual for retail and more
Given all the concerns raised by the pandemic, it‘s not surprising that as many as 60% of consumers now refuse to shop at stores that don’t offer curbside payment and pickup. And the trend isn’t just limited to stores and restaurants. Any business that accepts payments for services—veterinarian offices, mobile groomers, fast oil-change stations and more—are now adopting curbside payment capabilities.
How contactless payments work
Contactless payment systems utilize radio-frequency identification (RFID) memory chips that store data or “tags” and RFID readers that decode the message—the same technology that’s used for applications like package tracking, inventory management and toll collection.

A newer and more complex technology, near-field communication (NFC), is the basis for services like Apple Pay and Google Play that allow cardholders to use contactless payment platforms on their smartphones or wearable devices or for fast and easy transactions at point-of-sale (POS) terminals. NFC is also used for other applications like e-ticketing, allowing users to tap a transit card or smart device to enter a subway turnstile, ride a bus or use other forms of public transit. Some ATMs also have NFC-enabled capabilities that allow users to tap their debit card in an indicated area on the machine rather than manually typing in their PIN on a keypad.

A mobile wallet, also called a digital wallet, is a smartphone app that stores credit and debit card information—users pay at a checkout counter by just tapping their device. These apps effectively turn any credit or debit card into a contactless payment tool. Even if the card doesn’t have tap-to-pay, users can still keep checkout contactless by using the card on a mobile wallet.
The benefits of contactless payments
  • Safety – With all the health concerns surrounding the coronavirus, brick-and-mortar businesses and banks are looking to minimize the risks and mitigate customers’ concerns. According to a survey by The Ascent, 55% of consumers in the U.S. are worried about handling cash and about 75% of the respondents said they plan to continue using contactless payments once the pandemic is over. Which is why consulting firms like Accenture consider “the push toward a cashless society” to be a top priority for financial organizations and retail establishments. A recent poll of 17,000 customers in 19 countries, conducted by Mastercard, found that contactless payments are overwhelmingly considered a better and safer option. Whether science can actually prove that fact, perception tends to be reality where business is concerned.
  • Speedier transactions – Studies show that while the transaction time for a chip-enabled card can be as much as 30 to 45 seconds, a contactless transaction can be conducted in as few as 10 to 15 seconds.

If you want to learn more or have a customer interested in implementing contactless payments, reach out to your Ingram Micro payments team at impaymentsinformation@ingrammicro.com


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