New Wave of Contactless Payments Speeds Up Profits

Contactless payments produce a whole new field of payment possibilities for merchants. Contactless payments are fast, straightforward and pave the way for greater earnings. A wise computer chip, with information and an antenna is embedded 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 details on the card is read and the payment is processed without having a signature for purchases much less than $25.00 with no chargebacks to the merchant.

Merchants dont need 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 program, transaction management systems and readers.

We have been operating closely with processors, card issuers and terminal providers to develop an open method utilizing the IS0 14443 normal. It uses secure encryption technology. The contactless card doesnt leave the clients hands as a result it is a lot more secure and theres no skimming of data, assured Kahn who sees contactless as a great opportunity for merchants to increase income. He envisions contactless payments as a replacement for money since they are faster, much more convenient and expense much less due to less shrinkage and much less labor involved.

There are two sorts of contactless readers available: Peripheral Contactless Readers (PCRs) that plug in to current POS terminals, and Integrated Contactless Readers (ICRs) that replace standard readers mifare access cards and offer both magnetic-stripe- and contactless-reading capabilities. Merchants can buy either kind of reader. The PCRs typically expense about $150. Some merchant service providers such as Acies, nevertheless, are providing deals competitive plans and totally free readers with terminals.

David Robertson, Publisher of The Nilson Report (Carpinteria, Calif.) estimates that there are 12 million contactless cards currently in circulation in the U.S. He predicts that first contactless successes will be at the brand name retailers and then merchants in the areas where cards are deployed will adhere to suit when their consumers ask to use their contactless cards.

Buyers are asking for contactless in the New York Metro location where a lot of cards have been dropped, says Oleg Frier CEO and President Acies, Inc, a New York City-headquartered national payment processing and monetary services provider. Other places 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 usually when someone does not spend with cash the quantity of the transaction increases. Visa trials showed their contactless card transactions were 25% faster than money. MasterCard PayPass trials showed an enhance in transaction amounts mifare card sdk and 12 to 18 second reductions in payment instances for drive-thru transactions. Aite Group reports that CVS, the drug store chain, has found the average 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 buyers, such as quickly food restaurants, coffee houses, film theatres, drug shops, convenience shops and drive-thrus can benefit tremendously from contactless payment strategies. McDonalds, AMC Theatres, CVS, Meijer, Duane Reade, Regal Entertainment, Ritz Camera, Arbys, Cold Stone Creamery, Eckerd, Carls Jr., Great Occasions 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 getting installed in five,300 7-Eleven retailers and 350 Sheetz stores. WaWa markets is installing more than 2000 readers in its 540 stores co-branded with a credit card and loyalty system.

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 good results of contactless payments, stated Elvira Swanson, Visa spokeswoman. Visa, with 4 million Visa Contactless cards in circulation, gives collateral supplies, online demos, and merchant help teams to assist educate merchants.

This is the true factor. Contactless is beyond the chicken and egg concept stage now, when you look at how several financial institutions have created the selection to provide 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 methods. Merchants who accept contactless payments are listed at the MasterCard Web internet 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, Crucial Bank (debit cards) and Citizen.

There have been several pilot contactless programs in sports stadiums such as San Francisco, Seattle, Baltimore, and Philadelphia. Recently, another form aspect mifare sdk kit 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 basically holding their Nokia mobile phones equipped with Philips' NFC semiconductor chips and ViVOtech software package near one of the 150 terminals. NFC is compatible with ISO 1443 readers has other features such as the capacity to transmit a coupon to a reader.

Contactless payments are the wave of the future and will modify the way the planet pays for purchases, Khan said enthusiastically.

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