Which payment option could boost your business?
The recent explosion in mobile-based internet communications hasn’t been matched by a corresponding growth in mobile purchasing. The erratic nature of connection speeds can deter people from buying and selling via mobile. This is particularly significant with respect to concerns about transmitting sensitive financial information across vulnerable wireless carrier networks.
However, the mobile payment industry is growing at a seismic rate. Visa announced in October that the percentage of customers making regular payments from mobile devices had trebled in a year to 54%. Although mobile payments in America account for less than a seventh of total online purchases, rapid growth is expected between now and 2020. Therefore building a payment platform is clearly essential for any online trader, but what are the current options?
The leading method of online payment is a classic checkout portal where card information is entered, typically incorporating 2FA like Verified by Visa. Storing card data is inadvisable because mobile devices are less secure than home computers, so consumers have to manually enter card details into their smartphones or tablets every time. Even so, the popularity of payment gateways among retailers (such as WordPress plugins) make this a common option.
PayPal represents a more sophisticated solution to the issue of making payments on the move. Its Mobile Express Checkout can be installed into mobile sites, drawing funds from a linked bank account without the cumbersome process of entering card details. Despite endless phishing scams and fraudulent attempts to acquire customer data, PayPal is a robust and straightforward method of instantly transferring funds. However, retailers can incur significant transaction fees, and it’s easy to become locked out of your own PayPal account.
Keep an Eye on Your Money
Other payment gateways are looking to the future, with a growing focus on biometric details like voice recognition. Still in its formative stages of development, today’s POS technology requires customers to identify themselves with a fingerprint or eye scan. These gateways may still need 2FA entry of passwords or PIN codes, which rather negates the simplicity they initially promise. They may also need the customer to register their financial details with each retailer separately, creating multiple copies of biometric information on proprietary databases around the world. More realistically, a digital equivalent of Visa or MasterCard may well become the acknowledged go-to body for biometric payment transactions in future.
Paying Our Way
Mobile handsets can already be used to make in-store or online payments via PayPal or Apple Pay, and biometric data offers the potential to abolish PIN codes or other memorized data entirely. PayTango and Fingopay match fingerprints and vein patterns respectively to your card details, so any fingerprint scanner-equipped POS terminal can accept payment with the tap of a digit. Macate’s Gardevant resembles a bank card but actually contains unique biometric data to ensure fraud-free purchases. And one pioneering retailer in China allows customers to pay for their goods with a retinal scan. This checks their identity against a database of eyes and automatically extracts payment from the linked bank account.
Who Will Claim Payment Domination?
According to a major survey by LexisNexis earlier this year, mobile payments account for 14% of American transactions but 21% of fraud cases. There is clearly an urgent need to develop robust and fully secure payment gateways that will support mobile purchases as the market grows. It’s currently unclear whether we will end up with one gateway to rule them all or a variety of competing payment platforms, but tomorrow’s smartphone and tablet users should find it much easier to complete transactions than we do today.
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