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Making the most of electronic payment systems

cropped1By Rob Cameron
The checkout counter is usually the last point of interaction between a retailer and a customer and, as such, often the final opportunity to make a lasting impression. This reality underscores the need to make the payment experience as easy and straightforward as possible for customers.

This scenario can be compared to an iceberg. What the customer sees when making a payment is merely the tip of the iceberg, but supporting this experience takes a great deal of effort, planning and technology on behalf of merchants and payment service providers.

Just five years ago, many Canadian retail businesses and their customers were satisfied with traditional hardwired point-of-sale (POS) devices and standard debit/credit card acceptance. This is no longer the case, as an increasing number of consumers are turning to the convenience of contactless and mobile payments, whether in a store, gas station or restaurant. Being able to support such payments is especially important for franchises, as the convenience of the payment experience at any single location can help boost the reputation of the entire franchise system.

Amid tight margins and increased competition in the retail sector, Canadian franchisees rely on the quality, consistency and reliability of their payment systems, along with franchisor support and speed of response to any issues as they arise, not to mention integration with existing POS systems and, of course, the security of customers’ information.

Prioritizing plastic
By now, retail franchises are highly unlikely to be cash-only, but it is nevertheless beneficial to communicate to customers that you prefer them to pay by credit or debit card. For one thing, it is less convenient when employees have to collect cash and dispense change.

Debit and credit card payments, especially contactless ones, shave valuable seconds off each transaction. Instead of spending time handling cash, employees can serve customers more efficiently, delivering a better overall experience.

For another thing, the handling of cash adds unnecessary risk of financial loss compared to electronic payments. Cash is vulnerable to loss both through robbery and employee theft and is more difficult to track.

Many payment processors offer reporting tools that help franchisees and franchisors manage their business by reviewing reports online or downloading information into spreadsheets and accounting packages for forecasting and analysis.

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McDonald’s Canada is among franchise systems that are prioritizing contactless debit and credit card payments to save time per transaction.

Mobile wallets
Smartphones and smartwatches are set to bring mobile payments into the mainstream. ‘Mobile wallet’ apps from Apple, Google and Samsung, for example, allow a customer to securely store his/her credit card information on a smartphone and then pay for goods by tapping it on a payment terminal’s contactless sensor.

Paying by phone or watch adds an extra level of convenience for busy shoppers walking through a store with their hands full. For this reason, retailers are encouraged to let customers know as they become ready to accept mobile payments.

And fortunately, since apps like Apple Pay, Android Pay and Samsung Pay do not require specific proprietary payment terminals, many retail businesses in Canada already have the contactless payment technology necessary for their use. In some cases, a retailer may not yet be using the contactless features of a payment processor, but there is no additional cost required to activate those features.

Many customers still wonder whether or not mobile payments are secure. Apple Pay, by way of example, actually includes more safety measures than other, more traditional forms of payment. Apple’s Touch ID verification system requires the customer’s fingerprint to authenticate any payment, so even if his/her iPhone becomes lost or is stolen, no one else can make payments with it. As an additional level of security, a fingerprint is certainly harder to replicate than a signature.

There are also certain liability thresholds in place to protect retailers from chargebacks. In Canada, it is expected retailers will not be liable for any fraud-related chargebacks on purchases under $100.

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