Title:
Contactless Payments Merchant Accounts
Word Count:
797
Summary:
Contactless Payments Merchant Accounts
Consumers dont like carrying cash but are wary of handing over a credit card because of the risk of credit card fraud. But whats the alternative?
Contactless payments.
The next generation of electronic payment, contactless payments dont require the customer to hand over their card. The whole transaction is completed electronically, and their card never leaves their hand. Its faster, easier and much more secure.
But what a…
Keywords:
Contactless Payments Merchant Accounts
Article Body:
Contactless Payments Merchant Accounts
Consumers dont like carrying cash but are wary of handing over a credit card because of the risk of credit card fraud. But whats the alternative?
Contactless payments.
The next generation of electronic payment, contactless payments dont require the customer to hand over their card. The whole transaction is completed electronically, and their card never leaves their hand. Its faster, easier and much more secure.
But what about the merchant? Should cash-heavy merchants rush into setting up a contactless payments merchant account? The answer is a resounding yes! Contactless payments merchant accounts deliver even greater benefits to merchants than it does to consumers. Read on to find out how.
What is Contactless Payment?
Contactless payments merchant accounts are the third generation of electronic payments. (The first generation was the old plastic credit card, and the second was the magnetic stripe card.) Merchants with contactless payments merchant accounts enable customers to use their credit cards for purchases without ever handing their card over. Contactless payments merchant account transactions use one of the following methods:
Contactless readers;
Retailer cards/fobs;
NFC (near field communication) enabled cell phone payment software; or
Back end processing/over the air payment software.
Customers love it!
Research shows that 86% of consumers want to carry less cash, and most carry less than $20. (Survey was conducted in 2005 by lpsos and commissioned by MasterCard). Theyre growing more comfortable using credit, but theyre still quite worried about security issues when handing over their card. In fact, 91% of likely users would feel more secure if they were allowed to hold their payment card through their entire payment process.
And then theres ease of use, speed and convenience. Nationwide, almost 75% of respondents refuse to wait in line longer than five minutes for a purchase of less than $25, and more than 25% refuse to wait longer than just two minutes.
So how does contactless payment compare in terms of speed? Very well, in fact It takes only 1/3 to of the time of the average cash or traditional credit card transaction:
CVS Pharmacy Average Cash Transaction = 33.7 seconds
Average Card Transaction (w/o Signature = 26.7 seconds
Average RF Transaction = 12.5 seconds
So contactless payments increase customers sense of security and decrease hated wait-times. Its no surprise, then, that customers love it!
And the growth rate of contactless payments merchant accounts shows it. According to Brian Triplett, senior vice president for emerging product development-Visa USA, The adoption rate is the fastest weve seen for any new technology. I do expect we will continue to see significant growth; whether its double or triple well have to wait and see.
What are the Benefits for Merchants?
The most obvious benefit for merchants in having contactless payments merchant accounts is that consumers love it, so theyll use it more often and spend more.
But the benefits dont end there. Contactless payments merchant accounts also:
Leverage Top of Wallet convenience – Like traditional credit cards (and unlike cash), the customers card is always in their wallet, which means theyre more likely to spend, simply because they can.
Deliver increased merchant differentiation – Particularly in the early days of adoption, merchants with contactless payments merchant accounts will stand out from the crowd. Theyll offer consumers a new and exciting way to pay for goods and services.
Are cheaper to operate – Transactions clear as a card-present, magnetic stripe-read transaction, but card readers are a fraction of the cost of a new POS terminal.
Increase efficiency – Businesses with contactless payments merchant accounts enjoy much more rapid check-out times during peak hours.
Are easy to install and upgrade – The hardware for contactless payments merchant accounts is all plug-n-play.
Increase customer loyalty – Studies show that customers return to the participating merchants location on an average of two times a month.
Leverage a general consumer movement away from cash (20%) – Even customers who dont specifically love contactless payment probably DO specifically dislike cash. By offering them an alternative, businesses increase the likelihood of a sale.
Put simply, businesses with contactless payments merchant accounts enjoy increased transaction volume (average 45%) and increased ticket size (average 20%).
What Merchants Benefit Most from Contactless Payments Merchant Accounts?
Contactless payments merchant accounts are ideal for cash-heavy merchants. Target industries include:
QSR
Petroleum & C-store
Book Stores
Dry Cleaners
Video Rental
Pharmacy
Grocery
Parking
Movie Theaters
Stadiums & Arenas
Theme Parks
Events
Cafeterias (Schools & Corporate)
Taxis
Transit
Vending
News Stands
Parking Garages
Conclusion The Future of Contactless Payments Merchant Accounts?
Contactless payment offers significant bottom-line benefits to merchants. Its the next generation payment system thats faster, easier, more secure and more convenient for consumers, which means it facilitates more sales (greater volume transaction) of greater value (ticket lift) for merchants. Its a win-win situation!