With the annual back-to-school shopping wave already cresting and the holiday season lurking only a handful of weeks in the future, we thought it would be helpful to remind retailers and merchants across the country that the payment habits of Canadians – especially young Canadians – continue to change rapidly.
This is especially important for small-to-medium-sized retailers to remember, because payment technology is one area where small retailers can level the playing field with national or global competitors. For a local coffee shop, the opportunity to be as convenient and fast to purchase from as the large chain coffee shop on the next corner is not one to be ignored.
While cash and physical debit and credit cards continue to be a major part of the daily mix of payment methods, you need to accept contactless payments in order to remain on parity with bigger chains. This will enable you to meet the expectations of your best customers and the acceptance of mobile contactless payments.
The concept is a simple one: instead of paying with a physical debit or credit card, customers can use a card from their “wallet” on their mobile device (a smartphone, tablet, or watch). When a sale is rung up, the customer simply holds their device over the merchant’s payment terminal, authenticates themselves as needed, and completes the payment.
Smartphone devices supporting such wallets are becoming the norm. For consumers, options include Interac Debit on Apple Pay, Interac Debit on Android Pay, and Interac Flash in wallets offered by participating financial institutions like Scotiabank and Mobile Pay offered by Canadian credit unions.
While the convenience and efficiency benefits of mobile contactless payments are clear, the security benefits are just as important.
Through the Interac Token Service Provider (TSP) service, a customer’s financial information is replaced with randomized, one-time-use sequence of numbers, or “tokens”, which are used to complete a payment. Even if anyone gained unauthorized access to a token, they are meaningless in the wrong hands. Tokens are also account, device and wallet specific which further minimizes the possibility of fraud.
The even better news is that for all their high-tech benefits, mobile contactless payments are easy to implement, even for the smallest merchants. If you accept Interac Debit but don’t have a contactless terminal, ask your payment services provider to enable you to accept Interac Flash and other mobile contactless payments.
And if your business already accepts Interac Flash, it will accept other mobile wallet-based payment methods like Apple Pay and Android Pay without having to make any changes whatsoever – all that’s left for you to do is to put up stickers to make sure your customers know you can accept the latest ways to pay. Just like the big guys.
Looking for more? Click here for our guide on Digital Payments for Merchants.