Is Contactless Technology The Way Forward?
Some 350 years after it was first used as a method of payment, the humble cheque may well be on the way out. Statistics from payments association Apacs reveal that we are using fewer and fewer cheques to pay for things, favouring alternative “simpler” transaction mediums. The latest of these is contactless technology which allows you to pay for things by a simple touch of a screen.
Personally I have always preferred the tactile nature of paying for things with cash. When you can see the coins and notes passing from your hand to theirs, feel the weight lifted from your wallet, you have a heightened awareness of the worth of the product or service that you are purchasing. It makes you more demanding of quality and value, and ensures that you think twice before wasting money on unnecessary things. The larger the transaction, the more likely you are to miss the comforting bulge in your pocket as you leave the store. Distancing yourself from the cash is a dangerous thing. It makes spending and therefore wasting money far easier, and in a recession this is something that most people simply cannot afford. But contactless technology has chosen now, of all times, to launch itself on us. Good timing!
South Korea is leading the way with contactless technology, creating chips that go into mobile phones which allow users to pay for items by simply holding their phones up to a panel (no PINs, no signing, no waiting – the transaction is completed in seconds). They have achieved this through massive investment and cooperation which now means that all mobile phone contactless technology payments are processed through a single centre.
Over here Barclays are making similar moves. They are launching contactless technology in their debit cards: approximately 2 million of them will be available from the end of February, so that you too can have the convenience of paying for things in a swifter, simpler fashion. Limiting transactions to under £10 and randomly asking you for a PIN to reduce fraud, Barclays are confident that contactless technology will be a hit. But what of the future? How long will contactless technology be limited to £10 transactions? As demand for simplicity increases, will security be compromised and fraud start to rise on this new payment process, and will contactless technology simply make it easier for us to get into financial difficulty in an era of global recession?
One thing is for sure: all businesses need to be aware of this trend towards alternative transaction methods. If you want your customers to spend more, make it easier for them to do so. Credit cards, debit cards, chips in mobile phones and contactless technology: you should be aware of them all, and offer them to your customers.
It’s a shame that an institution such as the cheque should fall into disuse in the face of technological advancements, but just like nobody wants to get up to change channels on their TV these days because everyone uses a remote, nobody wants to fish around for a pen and waste time writing out cheques when they could just as easily chip and PIN or put their debit card up to a screen and complete their purchases in seconds.
Image © LittleDan77
