The smartphone and tablet industry is at it again. New mobile payment systems are constantly being introduced to the market, poised to start providing customers with a hundred different ways to pay for their purchase – and not just with modifications to the debit card to make it more user friendly, either. Huge transformations of both smartphones and point-of-sale systems are beginning to emerge, and they have everything to do with new applications being introduced to the smartphone market, offering retailers a new way to collect money from their customers.
The first option for retailers for supporting mobile payments is something of a Bluetooth device for registers. The communication technology is a radio system that allows two or more devices to commingle from a distance that's up close and personal so the signal doesn't get warped or the data being transmitted doesn't get stolen. The system lets customers simply tap a smartphone against a special reader to pay for a purchase, similar to QuickPay services that began popping up a few years ago for debit and credit cards.
Initiatives such as Google Wallet and Isis aim to drive NFC-based mobile payments into the retail landscape, but for now, you have to have the right smart phone or device to use this technology, as both the smartphone and the point-of-sale will need to have NFC enabled technology in place. Most larger retail stores have already made the conversion to fully digital registers in many locations, and installing an NFC-equipped register would be as easy as installing a certified application on these computers. However, for stores that haven't switched over to such a system, this new technology means new expenses for retailers, not to mention the consumer, as smartphones will also need special receivers to be NFC-ready.
A second option is to build a custom mobile payment system. Starbucks has started the ball rolling in this area as they already have a Starbucks Card mobile application. The app is tied to the company's Starbucks Card – which is generally a rechargable gift card with a rewards program and a registration online – and the card can be scanned at checkout with a wave of a smartphone. The charge is then posted on the Starbucks Card account, incurring rewards and taking the money away from the card.
There are even more options on top of these two, but the question is which way retailers will choose to go, if they choose to go anywhere at all.
