Tap to pay: What it is and how it benefits customers and businesses


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  1. Introduction
  2. What is tap to pay?
  3. How does tap to pay work?
  4. Types of contactless payments
  5. Is tap to pay secure?
  6. How to accept tap to pay payments from customers
  7. Benefits of accepting tap to pay as a payment method
    1. Speed and convenience
    2. Reliability and durability
    3. High consumer demand
    4. Improved hygiene for employees and customers
    5. Little to no extra cost

The latest major shift in preferred payment methods is contactless tap to pay, which has become a go-to for consumers and also offers significant benefits to retailers. Offering tap to pay means your business can process more transactions in less time compared with conventional payment methods, thus increasing turnover and allowing customers to complete their purchases faster. Over half of Americans already use contactless methods like tap to pay – a trend that is mirrored around the world. The $13 billion contactless payments industry is expected to nearly quadruple by 2026. Businesses that fail to update their payments ecosystem to accommodate contactless payments are likely to see sales suffer. Luckily, there’s a good chance that your payments setup is already equipped to accept tap to pay transactions.

We’ll cover what you need to know about tap to pay including how to implement it in your business.

What’s in this article?

  • What is tap to pay?
  • How does tap to pay work?
  • Types of contactless payments
  • Is tap to pay secure?
  • How to accept tap to pay payments from customers
  • Benefits of accepting tap to pay as a payment method

What is tap to pay?

Tap to pay is a wireless way for customers to pay at a point of sale (POS) terminal or card reader that uses short-range wireless near-field communication (NFC) – a specialised type of radio-frequency identification technology. Increasingly, tap to pay is becoming a preferred payment method for transactions of all kinds, making it a priority for businesses that want to offer a competitive, technology-forward payment experience to customers.

How does tap to pay work?

Tap to pay works at POS terminals like chip payment cards. Using NFC, the card or device sends a secure, single-use token to the payment terminal unique to that specific purchase. The wireless technology facilitates secure payments from contactless-enabled cards, wearable devices and payment-enabled mobile apps when a customer taps, waves or hovers their card or device at a payment terminal.

Since NFC is usually used by chip card readers, if you’re already set up to accept chip card payments, there’s a good chance you can also accept tap to pay with no additional work on your part.

Types of contactless payments

While all contactless payments essentially work in the same way, there are a variety of devices enabled with the technology necessary to conduct tap to pay transactions, including:

  • NFC-ready debit and credit cards
    Some payment cards have built-in NFC technology and are ready to be used with an enabled card reader, such as Stripe Reader. All the customer needs to do to use an NFC-ready card is tap, wave or hover the card close to the mobile card reader. This payment type is increasingly common as new cards become available to consumers.

  • Mobile or digital wallets
    Digital wallets are an app technology that saves users’ debit and credit card details in their mobile device to be used for contactless transactions. To pay with a mobile or digital wallet, a customer taps, waves or hovers their mobile device over an NFC-enabled reader in the same way they would with an NFC-integrated credit or debit card. Apple Pay for iPhone Tap to Pay users is the most popular digital wallet. Google Pay, PayPal, Android Pay and Samsung Pay are also popular choices. Consumers love mobile or digital tap to pay because it lightens their load – as long as they have their phone with them, they can leave their wallet at home.

  • Wearables
    Smart watches and other wearables like bracelets, fobs and rings aren’t just for counting steps and tracking heart rates. As the newest contactless payment type, wearables (such as the Fitbit and Apple Watch) are also the most compact option and a convenient choice for someone who wants to go for a run or quickly pop into the corner shop without the hassle of carrying their phone or their wallet.

Is tap to pay secure?

Contrary to the common perception that mobile device payments aren’t as safe as traditional options, tap to pay is one of the most secure payment methods available. This is because transactions that use tap to pay are processed in a way that does not include sensitive personal information, such as names, card numbers, security codes and expiry dates.

The contactless tap to pay method is even safer than magnetic strip (magstripe) or chip cards, which are more susceptible to account information transfer and fraud.

When customers use tap to pay, their card information and personal information are protected in different ways, including:

  1. Encryption, which is unique to each transaction.
  2. Tokenisation, which uses one-of-a-kind, random characters in place of bank or credit card information.
  3. Two-factor authentication with a PIN or face ID. While this may not apply to all tap to pay methods, most require some form of additional identity verification before allowing a transaction to go through.

How to accept tap to pay payments from customers

When it comes to accepting tap to pay payments from customers, the business's role is minimal and there is little variation among different types of tap to pay methods:

  • NFC-ready debit and credit cards
    Ensure that the contactless symbol – a rainbow-like icon with four curved lines – is displayed on the customer's card as well as your POS machine. When prompted to pay, the customer should tap the card or hover it within a couple of inches of the symbol.

  • Mobile or digital wallets
    Customers who have enabled tap to pay on their mobile device and added their bank and payment card information to their digital wallet app are ready to use this payment method, which uses the same NFC technology as cards. When your terminal displays a prompt, the customer holds or waves their device within a couple of inches of the contactless symbol. Since mobile or digital wallets often use a passcode or facial recognition to approve transactions, this process can take slightly longer than tap to pay cards. As mobile or digital wallets such as Apple Pay and Google Pay often use a passcode or facial recognition to approve transactions, this process can take slightly longer than tapping a card.

  • Wearables
    Customers who have NFC-enabled wearable devices can use them for tap to pay purchases. Once tap to pay is activated on the device and the customer has entered their bank and payment card details, they’re ready to pay with their wearable.

As with the card and digital wallet methods, when your terminal prompts the customer for their payment, they hold the wearable within two inches of the contactless symbol.

Since most modern card readers support NFC technology, if you currently accept in-person card payments from customers there's a good chance that you are able to accept tap to pay transactions. If you're just starting out in your business or you haven't yet begun accepting debit or credit cards at all, you'll need to set up a merchant account with a merchant service provider for POS hardware and payment processing. Stripe Terminal and Stripe Reader both come fully equipped to accept contactless payments from NFC-enabled devices and cards. To learn more, read our guide on accepting contactless payments from customers.

Note: When a tap to pay transaction is completed successfully, the POS machine will display a tick or a light, or emit an audible beep.

Benefits of accepting tap to pay as a payment method

Along with the important benefit of fraud protection, there are many reasons to accept payments through tap to pay.

Speed and convenience

Since contactless payments are up to ten times faster than other methods, it’s no wonder that they’re gaining popularity and quickly replacing traditional payment methods. Faster checkouts mean smoother customer experiences and a better turnover rate for businesses.

Reliability and durability

In addition to increased speed and ease of use, contactless tap to pay cards and digital wallets are more reliable than other payment methods. Namely, they’re more likely to work on the first attempt compared with magstripe or EMV chips cards, which can take multiple attempts to work and contain physical components that can eventually deteriorate from overuse. Tap to pay cards, along with smartphones and wearable devices with digital wallets, can experience failures and mechanical flaws, but the wear and tear is significantly less when compared to traditional credit and debit cards.

High consumer demand

Across consumer-facing industries, tap to pay’s popularity is growing rapidly, alongside customer expectations. Many customers favour their newer, tap to pay-enabled cards over older cards without this functionality. This trend will continue to increase as banks issue more NFC-enabled cards and more businesses upgrade their hardware to accommodate NFC technology for tap to pay.

During in-person check out, people want – and increasingly expect – a contactless option, and this is leading to more consumers choosing to leave home with nothing but their digital wallets. One study found that 15% of digital wallet users often leave their real wallets at home, and 11% consider leaving theirs at home if they know they’ll be able to use a digital wallet wherever they’re going. Offering your customers the ability to tap to pay is the new standard for all sizes of competitive businesses. In fact, over 65% of small and medium-sized businesses have pivoted and tried new things to remain competitive, with about 20% adding contactless payments to their operations.

Improved hygiene for employees and customers

Tap to pay eliminates the need for a customer to hand their card to a salesperson or touch a payment terminal or keypad, reducing the spread of germs. According to a study from American Express, 80% of businesses believe that contactless payments help them maintain a cleaner checkout area, making it safer for their employees and customers.

Little to no extra cost

Businesses that have not yet made the switch to contactless payments sometimes regard this option as more expensive than older methods of accepting debit and credit cards. This isn’t necessarily the case – it all depends on the payment processor you choose to work with. For example, Stripe doesn’t charge any more to accept contactless payments than other card payments.

To learn how Stripe supports tap to pay on iPhone or to get started right away, read more here.

The content in this article is for general information and education purposes only and should not be construed as legal or tax advice. Stripe does not warrant or guarantee the accurateness, completeness, adequacy, or currency of the information in the article. You should seek the advice of a competent attorney or accountant licensed to practice in your jurisdiction for advice on your particular situation.

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