In 2021, over two-thirds of merchants were already accepting contactless payments, and their number continues to grow fast due to the increasing demand. The technology behind this trending transaction type is called “Tap to Pay”.
If you process in-store purchases but still don’t offer your customers a contactless payment option, this guide is for you. Read ahead to learn what Tap to Pay is, how it works, and find out the reasons why you can’t remain competitive for long without implementing this technology!
As the name implies, Tap to Pay enables users to make purchases by tapping or waving their contactless card, smartphone, or wearable device over a reader. Any payment terminal that supports it features a contactless payment symbol - four curved lines that stand for a radio signal.
This is due to the fact that Tap to Pay uses a short-range wireless technology called Near Field Communication (NFC), which is a type of radio-frequency identification (RFID). NFC uses a high frequency of 13.56 MHz to enable close-range transactions between two devices.
There are two types of interactions between NFC-enabled devices:
No matter if it’s an active or passive transaction, Tap to Pay eliminates the need to touch the payment terminal or hand the card to the cashier. This was considered a big plus during the pandemic, but the list of the advantages that come together with contactless payments goes on.
The contactless payment industry is forecasted to reach $19.3 billion by 2026. Growth at such an exceptional pace is powered by the many advantages the Tap to Pay technology boasts, such as:
What’s more, Tap to Pay helps merchants to cater to a younger audience that rarely uses cash and credit cards. Thus, it’s safe to assume that this payment option will keep spreading worldwide.
The Tap to Pay technology emerged in the 1990s and has been gradually gaining popularity ever since. By 2019, many merchants have been implementing it in their operations, but the coronavirus outbreak has caused a surge in the use of this contactless technology.
In a global study conducted by Mastercard in 2020, 79% of respondents chose Tap to Pay transactions as their preferred payment method for everyday purchases. During those days, the pandemic was in full swing, and the majority of consumers motivated their choice with safety and cleanliness reasons.
In post-COVID times, contactless transactions have become the new normal. The wide public came to appreciate their convenience and speed of money transfer and started expecting brick-and-mortar stores to offer Tap to Pay, among other standard payment methods. Visa’s 2022 Back to Business study showed that 41% of consumers would not shop at places that fail to offer this payment option.
However, the growth of Tap to Pay’s influence doesn’t stop there - the technology is expected to gain even more recognition in the future.
For instance, in February 2022, Apple announced its plans to introduce Tap to Pay on iPhone. This new capability is expected to empower millions of merchants to use their iPhones to seamlessly and securely accept contactless bank cards, Apple Pay, and other digital wallets.
This functionality will first become available across the US and will be suitable for all types of merchants - from small businesses to large retailers. With no additional hardware needed, Tap to Pay on iPhone will offer businesses a fairly inexpensive tool to process transactions and increase their sales.
All in all, contactless transactions powered by the Tap to Pay technology have revolutionized the world of payments. As more and more people choose this payment option over the traditional ones, we are sure to see it keep up the upward trend for years to come.