Taking Advantage Of Three Major Developments In QR Code Payment

Nitin Gupta Forbes Councils Member

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Nitin Gupta, founder of QRCodeChimp. He's a technology leader with over two decades of technology development and management experience.

Whether buying ice cream from a food truck or luxury items from high-end shopping malls, people nowadays increasingly complete transactions digitally. As a user-friendly technology, QR codes can help ease online payments to merchants.

With how convenient it is—customers simply scan a QR code using their smartphones—it's no surprise how businesses, big or small, are leveraging this technology into their daily operations.

I'd like to give an overview of the three major developments that led to the rise of mobile payment apps and also highlight ways for small businesses to take advantage of their benefits.

Three Major Developments Accelerating The Use Of QR Code Payment

Here are insights into three developments that have influenced the surge in QR code payment among customers and businesses.

1. Contactless Pay During The Covid-19 Pandemic

During the pandemic, people tended to avoid using cash or cards to reduce physical contact. This resulted in a massive increase in the use of contactless payment methods.

A survey report found that 18.8% of US and U.K. consumers strongly agreed with the rising use of QR codes since the pandemic started. In China, QR code payments constituted 85% of the total mobile payments in 2020. In the post-pandemic scenario, using QR codes for payment has become a norm due to quick transactions, ease of use and a hygienic approach to payment.

2. Emergence Of Various Mobile Payment Applications

Various mobile payment apps are compatible with Android and iOS devices, making payments easy for smartphone users. Most digital payment platforms, such as Apple Pay, GPay, Alipay, WeChat Pay, PayPal, PhonePe, Cash App, etc., have mobile payment apps with QR code facilities. Users can make peer-to-peer payments and payments at merchants by scanning the QR codes.

3. Government Policies Toward A Digitalized Economy

Governments worldwide are actively promoting digital payment methods to support a digitalized economy. Several policies have been implemented to reduce cash dependency and encourage people or businesses to use digital payments. This has helped the rise of using QR code payments.

Tips For Taking Advantage Of QR Code Payments

This QR code solution simplifies customers' payment processes, making operations easy for small businesses. Restaurants, cafes, retail shops and hotels can use these solutions to allow hassle-free transactions from customers, especially during peak hours and seasons. Below, I'll share some practical tips for how small businesses can best take advantage of QR code payments.

Creating QR Codes

Installing point-of-sale (POS) terminals is costly and requires upfront investment. However, QR codes can help small businesses avoid this investment and provide seamless payment facilities for customers. Here's how to create a QR code payment for your business:

• Select a digital payment platform. Choose a service provider that meets your business requirements. Consider things like your volume of transactions and customer demographics. You can choose between local or global service providers.
• Account registration: Register your business account with the selected service provider. You must fill in information like bank details, company name and tax-related details.
• Generating and printing: Once registration is complete, you can generate a QR code that links to your business or personal bank account. Get a print of the QR code and place it where your customers can best see and scan it.

Within India at least, UPI payments through a QR code attract zero fees. Many payment platforms, though, charge fees when businesses allow their customers to use other digital wallets or debit/credit cards. However, I find this is usually a minimal charge for businesses compared to POS terminal setups.

Reducing Human Errors And Building Transparency

Storing and accepting physical cash in a store usually involves risks of theft, mismanagement and human errors. However, paying through a QR code minimizes the risk of payment errors and prevents miscounting cash or theft. Online transactions also help ease bookkeeping and foster transparency for businesses.

However, it's good practice for businesses to keep all payment options available, including cash or card payments. This allows customers to use their preferred payment methods and further provides flexibility and convenience. Balancing QR codes with other forms of traditional payments is the best way to facilitate seamless payments.

Strengthening Data Security And Protecting Customer Privacy

Using QR code payments is generally secure, but many businesses can be victims of financial fraud due to QR code phishing, malware attacks and spoofing. Businesses can implement the following security measures to mitigate fraud:

• Use data encryption. To secure sensitive data, businesses must use QR code payment gateways with SSL/TLS encryption.
• Set up multi-factor authentication. Depending on the application for the QR code, you can add an extra security layer for authentication with one-time passwords or biometric verification. Check if the QR code URL starts with "https" to ensure a secure network.
• Educating staff and customers. Businesses can also educate their staff and customers about the fraudulent risks associated with QR codes. Customers should not be required to share personal and sensitive information when using a merchant's QR codes.

Conclusion

As someone who helps provide QR codes, I've seen how payments through this technology can act as a versatile solution that ensures customers a seamless and secure payment process.

As more customers become tech-savvy and increasingly use smartphones, small businesses can integrate this technology to enhance their operations. Overall, using QR codes for payment can help assure peace of mind for both customers and businesses.