When it comes to accepting payments, every business may face a few issues while accepting payments from customers. The business modules are the major cause of most of these problems. Many businesses might accept payments via installments, some might accept a certain percentage of payments in advance, and still many others accept online payments even without having a website or an online store.
The world of online shopping is evolving, with more individuals opting for mobile phones over desktops. Many of the most successful websites across the globe now offer an interactive mobile version of the website and focus on the mobile-friendly customer experience. This is predictable, considering how most people now use mobile devices to browse, communicate, and make transactions.
Mobile payments are becoming more prevalent as a safe, quick, and easy way to accept payments. As per a study by Juniper Research, the global mobile payment volume is expected to reach $6 trillion. There are a variety of mobile payment options available, and these options can surely play a very important role in business growth. Let’s look at the different types of mobile payment options:
Types of Mobile Payments
NFC payments are mobile payments that interchange data between readers and payment devices using Near-Field Communication (NFC) technology. The NFC chips transfer encrypted data to execute a transaction when the payment and reader devices are in close proximity and activated. This process offers a quick checkout experience and a safe payment option.
NFC uses radio waves like Radio-Frequency Identification (RFID) labels leveraged by retail shops, warehouses, and other wireless tracking applications. NFC chips have a unique RFID radio frequency (13.56MHz) which exclusively functions when the chips are in nearest proximity.
Mobile Wallet Payments
Mobile Wallet is an app that allows users to make payments for various activities such as online shopping, top-up and bill payments, or paying at a grocery store or restaurant. The mobile wallet app securely stores the bank details or debit/credit card information of the users to enable mobile payments. Users can easily download the mobile wallet app, enter the bank details or debit/credit card details, and scan a QR code to pay online or directly pay to another bank account. Consumers can also complete the payments by bringing the phone near to the point-of-sale device (PoS) device. The PoS uses NFC technology to execute the transaction.
Magnetic Secure Transmission (MST) Payments
Magnetic Secure Transmission (MST) is a technology that is comparable to NFC. MST payments emit magnetic signals that connect the user's mobile device to the PoS device. This signal is identical to the magnetic connection developed when a typical credit card is swiped through the PoS terminal. MST technology is compatible with the majority of NFC-enabled PoS devices that allow mobile payments.
Quick Response (QR) code payments
The mobile application decodes the horizontal and vertical patterns of the matrix in the QR code. These patterns are then converted into a string of characters when the QR code is scanned with the mobile camera. After processing the information, the phone opens a browser link, verifies payment details, and confirms geolocation to complete the payment process. The consumer can also use the mobile app to scan the unique QR code shown on the merchant's app, then confirm the amount and process payment.
Global Scenario of Mobile Payment Acceptance
Governments and regulatory authorities worldwide are promoting the usage of mobile payments in order to create more inclusive societies as well as eliminate the dependency on currency notes. Thailand currently ranks as the leading country with regards to mobile wallet usage, as per the recent GlobalData's 2021 Financial Services Consumer Survey, with 93.7% of survey respondents confirming that they have a mobile wallet and they used it to shop in the last 12 months. Interestingly, the region's adoption rate is substantially greater than that of several established markets, such as the United States and the United Kingdom, amid considerable smartphone penetration in these countries, with adoption rates of 42.8% and 36.5%, respectively.
In 2020, the mobile payments industry was valued at USD 1449.56 billion predicted to rise at a CAGR of 24.5% to USD 5399.6 billion by 2026. With the constantly developing global economy, mobile phones have become an indispensable item for individuals. The regulatory push has urged banking and financial institutions to develop infrastructure that supports reliable and comfortable mobile payments in remote areas, creating a significant advantage for businesses and bringing the entire population into the financial spectrum.
Key Benefits of Accepting Mobile Payments:
Mobile payments lead to faster checkout, which enhances the consumer experience. Customers can also manage multiple accounts without carrying a physical wallet containing all their cards and cash. A mobile device can hold all the required bank details or card details to complete the payment procedure.
Accepting mobile payments makes it easier to obtain sales data, follow customer trends, and share transaction details with accountants. In addition, businesses won't have to pay any of the different bank charges that are associated with transferring money to the bank account or accepting credit card payments. There are fees associated with mobile payment systems as well, but they are usually low.
Mobile payments enable users to send and receive money using a mobile phone. Merchants can use mobile phones as a PoS or card reader by installing a mobile payment app. Rather than printing invoices and receipts and wasting paper and ink, businesses can deliver it through email or messaging apps.
Safe Payment Option
Mobile payments offer multiple security features and dynamic encryption to prevent fraud. Innovative technologies are constantly evolving to safeguard mobile payment transactions and protect sensitive bank details or card information. Mobile payments are believed to be safer than EMV chip card payments due to safety features such as PIN, smart biometrics, and so on.
Business Expansion Opportunity
Businesses can extend their reach well beyond a physical checkout counter owing to the technology that offers mobile payment acceptance. Customers nowadays prefer shopping with a mobile app installed on their smartphones, regardless of where they shop. Businesses can capitalize on the rising mobile payments and expand their reach to new regions such as local markets, festivals season e-commerce sales, trade exhibitions, and much more.
Get the Perfect Mobile Payment Partner for Your Business to Maximize Profits
Businesses have realized the fact that it's simple, quick, and safe to accept mobile payments. Therefore, with an aim to enhance customer experience, many businesses across the globe have switched to mobile payments. The advantages of mobile payments far exceed the relatively low costs and help businesses in preparing themselves for the future.
MobiFin Elite by Panamax is a convenient and highly secure digital financial platform that provides mobile payment solutions to the fintech industry around the world. The solution enables our clients to develop customized digital ecosystems. It can serve a wide range of corporate use cases owing to its innovative features and technical capability to deliver mobile wallet services across different transaction channel.