Prepping for what's next in mobile payment

Contactless payment systems have been around for a long time. The first one that I recall seeing was at my local gas station in the mid-1990s and, at the time, did not give the advantages much thought, so I never tried it. The next time was when some of the Google phones came out with a way to settle your tab with your phone as part of Google Wallet. Even then, the technology and usage really never caught fire.

Why is this payment mode catching on now?
In Apple’s recent release of the iPhone 6, it incorporated the Apple Pay feature, which promises users more safety and security than a credit card. Apple Pay is a variation of a contactless type of payment, but is very different than Google Wallet. My prediction is that Apple Pay will revolutionize the mobile-payment process.

How does it work?
In simplified terms, there are three primary technologies that make this mode safer. One is called near field communication (NFC), which allows one- or two-way communication from a device that is very close to another that also has the technology built into it. The second is tokenization, which allows a user who has preloaded credit card information in their device to pay a merchant without the merchant ever getting the credit card or credit card information. Finally, bio metrics. In order to pay, your phone has to be programmed to recognize your fingerprint.

Should I rush to buy payment terminals?
I would not work my teams 24/7 to accept this type of payment. But, it will come to fruition and probably sooner than you think.

Where can I use it now?
According to Apple’s website, there are more than 220,000 places to use this technology. Target already has NFC terminals in some of its stores as does Macy’s. Walt Disney World, Starbucks, McDonalds and Open Table are among the major brands in hospitality that are accepting Apple Pay.

How will it impact the hospitality industry?
Since some of the major brands are using NFC as room keys, using Apple Pay for hotel charges can’t be far behind (although I have no inside knowledge of this, so please don’t buy stock based on this statement). Imagine being able to sell guests items out of the honor bar and getting money for it rather than relying on their honor; not having to worry about having change for your night team; or, saving the labor to make sure that the currency provided is legitimate. The possibilities are virtually limitless.

 

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