New Wave of Contactless Payments Speeds Up Earnings
Contactless payments produce a whole new field of payment possibilities for merchants. Contactless payments are quick, basic and pave the way for higher earnings. A intelligent pc chip, with data and an antenna is embedded mifare access cards into a credit card, debit card or fob. When the card or fob is tapped on a radio frequency reader, the reader sends out a radio signal that activates the card, the data on the card is read and the payment is processed with out a signature for purchases less than $25.00 with no chargebacks to the merchant.
Merchants dont require to worry about compatibility with their present systems or security said, Mohamed Khan, President and Founder of ViVOtech, Santa Clara, Calif.-based developer of contactless software package, transaction management systems and readers.
We have been operating closely with processors, card issuers and terminal providers to develop an open program making use of the IS0 14443 standard. It uses secure encryption technologies. The contactless card doesnt leave the customers hands for that reason it is much more secure and theres no skimming of information, assured Kahn who sees contactless as a excellent opportunity for merchants to improve income. He envisions contactless payments as a replacement for cash simply because they are more rapidly, mifare sdk kit far more convenient and expense much less due to less shrinkage and less labor involved.
There are two varieties of contactless readers obtainable: Peripheral Contactless Readers (PCRs) that plug in to existing POS terminals, and Integrated Contactless Readers (ICRs) that replace classic readers and offer each magnetic-stripe- and contactless-reading capabilities. Merchants can buy either type of reader. The PCRs typically price around $150. Some merchant service providers such as Acies, however, are offering deals competitive plans and free readers with terminals.
David Robertson, Publisher of The Nilson Report (Carpinteria, Calif.) estimates that there are 12 million contactless cards presently in circulation in the U.S. He predicts that initial contactless successes will be at the brand name retailers and then merchants in the places where cards are deployed will follow suit when their clients ask to use their contactless cards.
Customers are asking for contactless in the New York Metro region exactly where numerous cards have been dropped, says Oleg Frier CEO and President Acies, Inc, a New York City-headquartered national payment processing and financial services provider. Other places exactly where there are substantial contactless readers and cards contain Atlanta, Philadelphia, Denver, Dallas and Orlando, says Khan.
Research show the speed and added value of contactless payments since typically when somebody does not spend with money the amount of the transaction increases. Visa trials showed their contactless card transactions were 25% faster than cash. MasterCard PayPass trials showed an boost in transaction amounts and 12 to 18 second reductions in payment times for drive-thru transactions. Aite Group reports that CVS, the drug shop chain, has located the typical contactless transaction takes 12.5 seconds, versus 26.7 seconds for magnetic-stripe card payments and 33.7 seconds for a cash transaction.
Merchants who have a tiny time frame to service customers, such as quickly food restaurants, coffee homes, film theatres, drug shops, convenience stores and drive-thrus can benefit greatly from contactless payment strategies. McDonalds, AMC Theatres, CVS, Meijer, Duane Reade, Regal Entertainment, Ritz Camera, Arbys, Cold Stone Creamery, Eckerd, Carls Jr., Excellent Times Burger, KFC, RaceTrac, Subway, Sonic (Drive-In Restaurants) and Walgreens have installed contactless readers. Convenience stores are gearing up to accept contactless payments. Contactless readers are being installed in 5,300 7-Eleven retailers and 350 Sheetz retailers. WaWa markets is installing over 2000 readers in its 540 retailers co-branded with a credit card and loyalty plan.
Card associations are also gung-ho for contactless payments.
It takes a village to launch a new technologies, at Visa, we have an absolute commitment to assure success of contactless payments, stated Elvira Swanson, Visa spokeswoman. Visa, with four million Visa Contactless cards in circulation, delivers mifare collateral materials, on the internet demos, and merchant help teams to assist educate merchants.
This is the actual factor. Contactless is beyond the chicken and egg concept stage now, when you look at how many economic institutions have made the decision to offer you contactless and the quantity of national merchants accepting it, mentioned T.J. Sharkey, Vice President, Organization Development, U.S. Acceptance, MasterCard International. MasterCard is supporting contactless in a lot of approaches. Merchants who accept contactless payments are listed at the MasterCard Web web site exactly where there are demonstrations on how their Tap N Go, PayPass cards operate. Tv commercials illustrating their PayPass cards are airing nationally.
Banks issuing contactless cards include Citibank, MBNA, HSBC (debit cards), JP Morgan Chase, Important Bank (debit cards) and Citizen.
There have been several pilot contactless programs in sports stadiums which includes San Francisco, Seattle, Baltimore, and Philadelphia. Not too long ago, one more form factor of contactless has been added into the mix, with the trial of NFC (Close to Field Communications) contactless payments from cell phones at the Philips Arena in Atlanta. Season ticket holders with Chase-issued Visa credit accounts and Cingular Wireless accounts can make contactless payments by simply holding their Nokia mobile phones equipped with Philips' NFC semiconductor chips and ViVOtech computer software near one of the 150 terminals. NFC is compatible with ISO 1443 readers has other features such as the capability to transmit a coupon to a reader.
Contactless payments are the wave of the future and will change the way the globe pays for purchases, Khan mentioned enthusiastically.
###
