People’s lives have revolved virtually around technology since the COVID-19 pandemic. When face-to-face interactions are almost impossible, people rely on technology to go to school, conduct business transactions, and connect with their loved ones. As a result, consumers and business owners are discovering more tech capabilities to support their everyday life amid the many physical limitations caused by COVID-19.
If there’s one digital solution that gained widespread acceptance during the pandemic, it would be the rise of contactless payments. Today, consumers can now pay for their products and services through their electronic devices. Cash on delivery service is also available to protect businesses from late payments or customers who won’t pay for their orders. In this case, having different payment methods allowed business owners to provide more choices when it comes to payments.
Contactless payments have helped businesses offer an efficient and seamless service to their customers. In fact, those who already offer contactless payment fared better than other competitors that rely on traditional payment methods. In this article, we’ll discuss why businesses today should fully embrace contactless payments and their implications for everyday transactions.
Increased impulse purchases
Compared to traditional payment methods, contactless payment is an effective way to increase the average transaction value per customer. Contactless payments remove the burden from customers when deciding whether they have enough cash on their wallets. They simply have to connect their personal accounts to the website and reduce the total amount of their orders. All these things can be done without taking out any physical cash.
Impulse purchases are also more likely, which helps your business boost your revenue. Some businesses even offer discounts and vouchers to customers if they pay through a contactless channel. The more discount the customer gets, the more items they put in their shopping carts.
Contactless payments are also an effective marketing platform to further boost customer’s loyalty to the business. Online loyalty programs provide exciting rewards for those who use contactless payments. One example is Starbucks, which uses a reward system for those who submit payments through their application.
Reduced business risk
Contactless payments offer a secure and safe checkout experience both for customers and the business owner. They provide better security and encryption than credit cards that rely on pins and magnetic stripes to complete transactions. Customers have peace of mind knowing their personal data won’t be easily taken by cybercriminals every time they transact online.
Contactless payments use near-field communication (NFC) and radio frequency identification (RFID) technology that avoids skimming information and offers a more secure transaction process. This lessens the likelihood of fraud losses because of the fast authorization time, making it difficult for criminals to obtain the customer’s card information.
Contactless payment only takes 30 seconds or less to complete a transaction. Credit card is significantly slower, and it also runs the risk of frauds. With contactless methods, business owners ensure that the money comes from a reputable third-party service.
On the other hand, NFC technology ensures secured transactions since there’s no physical contact between the POS and the smartphone or credit. All you have to do is simply tap and go.
Contactless payment also lessens the safety risks involved in handling money and cards. You can ensure your employees and customers are completely safe from the possible spread of bacteria and deadly viruses.
One of the greatest drawbacks of the EMV chip is the long transaction time. It also involved friction or direct and indirect costs related to the execution of a monetary transaction.
Contactless payments, on the other hand, are a form of frictionless payment that minimizes the friction or barriers of buying, giving customers a smoother purchase experience. In turn, the business doesn’t have to worry about paying additional fees compared to regular credit card transactions.
Contactless payments are incredibly faster than credit card transactions. There is no need to waste time digging into your wallet for a credit/debit card and waiting for several seconds to enter the PIN. It saves time since there’s no need to count loose change, both for the customer and cashier staff.
You’re also helping the environment since you eliminate the use of paper and ink by sending a copy of the receipt to the customer’s email. Contactless payments also eliminate the need to hire employees since they can handle faster transaction times even during peak hours.
Giving the rising adoption of contactless payments, business owners should consider embracing this new technology. Offering contactless payment systems opens opportunities for businesses to provide better services and develop positive relationships with their customers.