Will Retailers Need a POS Terminal After Covid?



Until now, most consumers have relied on bank cards to make in-store purchases, and the seller needed only a payment terminal to conduct the transaction. But thanks to  and Google Pay, a growing number of users are now making purchases on their phones instead of using bank cards, creating a smoother checkout experience. Phone payments also make it easier to avoid transmitting Covid, as there’s no need to touch a shared pin pad on a payment terminal. With the increasing prevalence of mobile payments, it seems inevitable that retailers will soon be able to do without a payment terminal altogether.

The progress in making and accepting payments has affected buyers, sellers and big tech alike. For instance, to further accelerate the transition to the contactless era, Apple bought Mobeewave, a SoftPOS provider in Canada. The lesson for businesses here is that there is no sense in having an expensive payment terminal if a mobile device can do the same. It seems that Apple was the first to understand this progression.


Post-Covid world

The changes that have emerged as a result of the pandemic cannot be underestimated. Social distancing and hygiene measures have had a direct and irreversible impact on the way businesses conduct their operations.

Gone are the days of long queues and overcrowded restaurants and pubs. Germany, England and other European countries are announcing full lockdowns, while France has already declared that many traditional Christmas festivities will be canceled across the country. Moscow authorities have issued a general order to all enterprises catering to mass gatherings, including restaurants and banquet halls, to cancel all reservations for the New Year’s holidays, placing a full ban on service from 23:00 to 6:00 local time.

Though takeout services will remain operational, the restrictions on indoor gatherings will inevitably have a significant impact on revenues across the hospitality sector. Many venues rely on profits from these traditionally busy periods to get them through quiet times throughout the rest of the year.


Chinese PoS devices here to stay as cheaper options not on cards

Mumbai: The banking and payments sector may have to continue relying on ‘Made in China’ payment terminals or point of sale (PoS) machines, in the absence of cost-effective domestic or international alternatives.

Amid growing demand for digital payments in India, these swipe machines are the key hardware to process credit and debit card-based transactions at malls and retail stores. Following the government’s directive to reduce dependence on Chinese goods, payments providers are looking at alternative options, but pricing and legacy challenges may prevent any immediate migration, multiple industry sources told ET.

The deployment of these terminals in rural and semi-urban areas is central to the government’s flagship Digital India initiative. The Reserve Bank of India had earmarked ₹250 crore in May to increases deployment of these payment terminals in rural areas, with a special focus on states in the Northeast. Currently, over 95% of POS terminal imports are from China, where the market is dominated by three global manufacturers — US-based Verifone, France-based Ingenico and Hong Kong-based Pax Technolog ..


Mastercard, Axis Bank, Zoho & Others Team Up To Add POS Machines To Smartphones

One of the world’s leading payments player Mastercard has inked an agreement with Axis Bank and French payments service provider Worldline to convert smartphones into point of sale (PoS) devices.

With this arrangement, they are looking to enable retailers and small merchants to accept digital payments through cards and other modes without a POS machine. They are aiming to expand that infrastructure for contactless card payments while replacing swipe machines across the country.

However, the feature will work only on smartphones which are NFC enabled. Retailers will be provided with a mobile application which will allow them to accept payments from debit or credit cards.

Besides accepting digital payments, the application will also offer retailers with subscription-based services such as digital onboarding and digital accounting services on a single interface.

Meanwhile, the application will also enable businesses with an option to offer digital services to customers. This functionality has been integrated into the application by Chennai-based SaaS major Zoho, according to a report by Economic Times.

With this offering, Mastercard has joined the likes of Amazon, Google, Paytm and JioMart which are also working on digitisation of retailers while ramping up their plans to get a chunk of the highly unorganised offline to online (O2O) retail market in India.


The South African app that turns your smartphone into a card machine

Nedbank recently launched its new tap-on-phone functionality, which allows its clients to use their smartphones as point-of-sale (POS) terminals.

This means they can accept NFC payments, whether from a contactless card or a payment app on a smartwatch or other smartphone, without needing to own a dedicated payment terminal.

The technology is made possible through a product called “Halo”, which was created by South African software development and consulting company Synthesis.

Halo is a mobile payment terminal platform that is compatible with any Android smartphone that supports NFC technology.

Synthesis has partnered with Nedbank to offer this tap-on-phone functionality exclusively through Nedbank for just under a year, although it could technically be adopted by other banks following this exclusivity period.

MyBroadband spoke to Synthesis Product Manager Pierre Aurel about the development of the software and its potential applications.

“We have had interest from other acquiring banks, but won’t go live with another SA bank until after the exclusivity period,” Aurel said.

“We can, however, work with banks outside of South Africa, which means we’ll be aiming to win customers offshore and compete globally.”

Synthesis’s target markets for the rollout of Halo are regions with high contactless adoption, such as countries in Europe and Asia.

Adoption and roadmap

Aurel noted that Synthesis is not the first global provider to pilot tap-on-phone technology, but it said it is well-placed to roll out Halo both locally and globally.

“We’re a proudly South African company and believe we can be the best in the world when it comes to Tap on Phone.”

“Tap on Phone is currently being run as a pilot programme with Visa and Mastercard,” Aurel said.

“Next year we will transition from the Pilot phase to the PCI CPoC (Contactless Payments on Commercial off the Shelf) standard.”

He noted that Halo currently does not include PIN entry requirements for higher value transactions, but this will be piloted by Synthesis before the end of the year.

Considering the global pandemic, Aurel believes that Halo is uniquely positioned to address the challenge of fast and convenient payments.

“Call it fortuitous timing, but the fact that this emerging technology has arrived during a pandemic means we expect rapid adoption of Tap on Phone,” he said.

“As physical distancing becomes the new norm and we move towards a cashless society, contactless payments will be part of every purchase or payment interaction.”

The solution is particularly compelling for street vendors who previously would not have access to a traditional POS terminal.

Aurel noted that because iOS is closed to the development of payment apps, Halo is currently only available for Android devices.

“We’re also watching how the Huawei situation develops with the decoupling from Google and the growth of their own App store.”

Security and limitations

The tap-on-phone payment method enabled by Halo has similar security to that of online and app banking services, as it requires users to log in with their credentials.

“Assuming there were fraudulent transactions, these would be settled into a bank account of a known merchant, so it would be easy to trace as the bank knows their merchants and have the necessary fraud teams to take action,” Aurel said.

“The risk here would be the same as someone stealing another merchant’s traditional POS device and making payments in the merchant’s account.”

“The thief cannot access the money from the merchant’s account, except if there was collusion,” he said.

The Halo application has various security features which meet the requirements set out by both Visa and Mastercard.

“More than 50% of our development effort and time has purely been on the security architecture of the App,” Aurel said.

“Luckily, the Synthesis team had the right mix of skilled experts in cryptography, security and cloud computing to deliver this.”

The app is subjected to almost all the same tests as a traditional POS terminal, and the proprietary software kernel developed by Synthesis for the application has obtained L2 certification for both Visa and Mastercard.

“There are many barriers to obtaining this certification, these include having specialist technical skills, sponsorship from a bank (acquirer) and the certification costs (approx. R 1.2mil),” Aurel said.

“This puts Halo in an elite club of payment providers across the globe.”

Payment Methods

Verifone and SITA Team To Enable Payments In Airports

Verifone, the payments and commerce solutions company, announced Wednesday (June 21) that it is working with SITA, the air transport IT and communications company to offer a payment solution integrating an airport’s shared IT infrastructure and Verifone payment devices.

In a press release, Verifone said that nearly all of the airport and airlines in the world do business with SITA and that nearly every passenger flight relies on SITA technology, giving it an unrivalled presence at more than 1,000 of the world’s airports. Verifone has integrated with SITA’s AirportConnect Common-Use Payment Service to enable secure payment acceptance by multiple airlines and ground handlers on a single Verifone device installed at each touchpoint – desk, kiosk or bag drop.

“For airlines, the ability to facilitate payments on shared IT infrastructure at the world’s airports is vital to provide passengers with an integrated air travel experience every step of the way. Our work with Verifone, to deliver this innovative payment solution, allows multiple merchants to use the same device in line with PCI security standards. It enables airlines, airports and other air transport industry stakeholders to accept secure payments in a common-use environment,” said Barbara Dalibard, CEO of SITA in the press release.

Verifone’s point-to-point encryption (P2PE) technology, with EMV and PCI-compliant chip card payment solutions, applications and processes, will allow multiple merchants to accept payments on the same device. With this service, Verifone VX 820, a countertop and PIN pad, and UX, a durable unattended payment solution line with PIN pad and contactless capabilities, will accept payments at airports worldwide that use SITA’s common-use passenger processing infrastructure. “As a leading global innovator and trusted partner, businesses look to Verifone for the means to simplify their payments experience and build positive relationships with their customers. Working with SITA, a global IT leader in the airline industry, Verifone is bringing large-scale, reliable, secure payment touchpoints and convenience to traveling customers at airport counters and kiosks around the world. The agreement is a milestone in expanding our secure payments and future dynamic point-of-sale (POS) interaction in the transportation industry,” said Joe Mach, president of Verifone North America, in the same press release.


Contactless Payments Are Going Mainstream

In a year that will see more than 25,000 retail stores blink out of existence, with an estimated 16,000 restaurants having closed permanently by August, people could use some upbeat news.

It’s out there. Signs of economic recovery are visible, as are inspiring stories of SMBs successfully adapting and reinventing post-pandemic. You just have to know where to look.

PYMNTS’ September 2020 Small and Medium Business Reopening report, done in collaboration with American Express, is a concentrated source of intelligence on developments in the field that show a way forward for SMBs, from the year of COVID and into more prosperous times.

Noting that 86 percent of SMBs said they were at least partially open as of August, up from 79 percent in May, “many SMBs are soldiering on … instituting myriad operational changes to protect their communities and to ease customers’ fears about infection. One especially notable trend is businesses increasing adoption of contactless payment methods like cards and mobile wallets,” per the new report.

“Almost 17 percent of SMBs added mobile wallet support as of May, and 30.6 percent of small firms already had these capabilities in place. These adaptations have been well-received by customers, too, as half of U.S. consumers reported they had made at least four contactless transactions as of April.”

Contactless and the Ubiquity Challenge

Contactless is clearly the future of payments, but there’s still a ways to go before ubiquity is reached, as is explained through many examples in the Small and Medium Business Reopening Report.

“For contactless payments to really become widespread in the U.S., we need a few factors to come together: strong interest from both merchants and consumers; enablement of the technology, particularly across smaller merchants; and a trigger that sparks a lasting change in how people pay,” Liz Karl, vice president of the Payments Consulting Group, American Express, told PYMNTS.

Karl noted that “over the last several months, there’s been a spike in interest from U.S. merchants looking for no-touch payment options due to health concerns from the pandemic, and U.S. consumers say they are significantly more likely to use contactless payments than before the outbreak.”

She pointed to indicators that “COVID-19 has created an environment where those [aforementioned] factors are coming together to make contactless adoption more widespread in the U.S., and that contactless is now here to stay.”

With 60 percent of SMBs reporting a March sales plummet and many doubting that they can outlast the pandemic, “physical retailers have thus been working hard to create purchasing environments that are safe for both consumers and employees,” per the new report.

Fears Linger, But Main Street SMBs Soldier On

What’s kind of cool about this bad situation is a “phase” of the reopening that isn’t widely discussed: the discovery phase, where consumers make their first-ever contactless payment. Generally speaking, people like it. It’s fast and safe — and they don’t have to touch anything.

“A sizable share of consumers who had not experimented with contactless payments before the pandemic are now making their first forays into using the technology. A late-March survey found that 30 percent of Americans made their first mobile wallet and contactless purchases during the early stages of the public health crisis,” according to the Small and Medium Business Reopening Report.

COVID-19 fears were responsible for most of that, as “29 percent of those surveyed said they had serious concerns about catching COVID-19 from using cash and 22 percent said the same about non-touchless payment cards. Contactless payment usage has only grown over the past several months, too, indicating that shoppers have been satisfied with these transactions.”

The report found that “more than 50 percent of U.S. consumers were reportedly using touchless payments by July, for example, and contactless card options had become the go-to method for 30 percent of shoppers by that point as well.”

Banks, corporates and even regulators now recognize the imperative to modernize — not just digitize —the infrastructures and workflows that move money and data between businesses domestically and cross-border.

Together with Visa, PYMNTS invites you to a month-long series of livestreamed programs on these issues as they reshape B2B payments. Masters of modernization share insights and answer questions during a mix of intimate fireside chats and vibrant virtual roundtables.

Digital Payments Uncategorized

No cash please, UAE merchants go for contactless payments

Dubai: More than 90 per cent of small businesses in the UAE are starting to feel optimistic – that’s according to a new study by Visa.

But these businesses reckon that it will be a further six months before they expect to get back into full operations. The sense of optimism among local businesses is higher than what their global counterparts feel – with only 67 per cent saying they were reasonably confident.

Over two in five of local SMEs now have contact payments in place after the pandemic broke out, and forced businesses to make changes in the way they connected with customers. And three in five even said they stopped accepting cash during the pandemic.

According to the Visa study, 9 out of 10 consumers in the UAE have changed how they pay due to COVID-19, including shopping online when possible (59 per cent), using contactless payments (52 per cent) and not using cash as much (40 per cent).

Yet there are hurdles

Despite the mindset change among business owners, problems remain. According to Visa, “92 per cent of merchants in the UAE still have concerns about shifting their business online or increasing online presence (compared to 74 per cent globally), highlighting the need for additional support to help SMEs transition to digital.”

“Consumers are putting COVID-19 safety measures at the top of their shopping agenda and favouring businesses that do the same,” said Shahebaz Khan, Visa’s General Manager for the UAE. “Historically, we have seen behaviour change at the point of sale as a gradual shift over time.

“But COVID-19 has created an immediate need for safer, more efficient shopping experiences both online and offline as consumers rapidly migrate to digital commerce.”


ADCB, Visa transform merchant smartphones into payment terminals

ABU DHABI, 3rd September, 2020 (WAM) — Abu Dhabi Commercial Bank, ADCB, is launching UAE’s first virtual Point of Sale, POS, payment terminal, in partnership with Visa, the world’s leader in digital payments. ADCB PACE PAY facilitates card payments through the merchant’s smartphone, empowering traditionally cash-driven SMEs to continue doing business despite social distancing.

Developed by payment service provider Paysky Inc, ADCB PACE PAY is the only virtual POS available on both Android and IOS platforms. The app is compatible with all smartphones and tablets, eliminating the need to invest in a physical device. In addition to scanning a credit or debit card in-store, ADCB PACE PAY allows remote payments for home deliveries by generating payment links that can be shared via social media such as WhatsApp, Facebook Messenger, SMS and email.

The solution is pre-integrated into a payment gateway, making it easier for smaller merchants to transition to eCommerce without the long and expensive integration process. They simply need to login to start using ADCB PACE PAY. Having multiple users on the same account enables greater home delivery coverage. An interactive dashboard of all transactions encourages business owners to develop data-driven strategies to enhance their business.

Arup Mukhopadhyay, Head of Consumer Banking, ADCB says, “ADCB is delighted to partner with Visa to launch ADCB Pace Pay, an innovative app specially designed to equip small businesses across the UAE with digital payment infrastructure at zero cost per transaction. The current need for social distancing and minimum contact has accelerated the UAE’s journey to a cashless economy. However, the micro and SME community has faced several challenges as 50 percent of all payments in the UAE are still in cash. Committed to serving the needs of SMEs in the UAE, our virtual POS solution not only helps to include the small business community in the country’s digital transformation, but also provides them with business intelligence through the interactive dashboard.”

Shahebaz Khan, General Manager, UAE, Visa, said, “As businesses large and small continue to endure the financial impact of COVID-19, one thing is clear – the payment experience needs a reboot because consumers are increasingly demanding a digital-first experience. Our recent global Back to the Business study showed that because of the pandemic, 9 out of 10 consumers in the UAE have changed how they pay – they want to reduce their cash usage and will opt for online and contactless payments if available.” ”The launch of ADCB Pace Pay could not have come at a better time as we need to provide businesses with practical solutions that can help them address their customers’ preferences. ADCB Pace Pay is an extremely cost-efficient, convenient and safe way for merchants to immediately enable their existing Android or IOS phone to start accepting card payments and we’re very proud to work with a forward-thinking partner like ADCB to launch this truly innovative solution,” he added.


Small Business Trends

We denounce with righteous indignation and dislike men who are so beguiled and demoralized by the charms of pleasure of the moment, so blinded by desire, that they cannot foresee the pain and trouble that are bound to ensue; and equal blame belongs to those who fail in their duty through weakness of will, which is the same as saying through shrinking from toil and pain. They were sparing of the Heat-Ray that night, either because they had but a limited supply of material for its production or because they did not wish to destroy the country but only to crush and overawe the opposition they had aroused. In the latter aim they certainly succeeded. Sunday night was the end of the organised opposition to their movements. After that no body of men would stand against them, so hopeless was the enterprise.