Asda has become the latest big retailer to take the plunge with contactless payment. Richard Olds, chief executive officer at Vista Support, asks if the move by the supermarket giant will be the tipping point for mass acceptance of the technology.
Asda has announced it will be introducing contactless payment to 25 of its stores from July. It follows in the footsteps of other big retailers, including Tesco, Waitrose and WH Smith, who are to begin offering the cashless alternative to its customers. While the use of near-field communications (NFC), such as the London Oyster card, has become commonplace, retailers have been slower to embrace the technology.
The security of contactless payment remains a critical concern for both retailers and consumers. The recent Channel Four investigation, which found payments could be intercepted by card readers built in to mobile phones, will only have heightened such apprehensions. In outlets using contactless payment technology, transactions have so far been restricted to under £15 in order to minimise the extent of any potential theft. Security levels will need to be improved significantly in order for contactless payment to truly take off – especially for high-value purchases.
Neither is contactless a ‘one-size-fits-all’ solution. Customers are unlikely to make use of swipe-and-go payment if they can’t see the advantage in doing so. Saving time during the till transaction is of little value if the customer still has to wait for the product to be packed or prepared, as they would in fast-food outlets.
However, the capabilities of this technology are far-reaching in terms of convenience. Some restaurant companies are already making the dining experience more convenient for customers by enabling automated ordering from the table and processing payments without the need to visit a till point.
Developments like Google Wallet are helping drive the move towards a cashless society. The ability to store credit cards on your mobile phone and pay with a tap of the keypad will undoubtedly be attractive to many consumers. In turn, they will look to retailers such as Asda to support the contactless technology.
Both consumer and retailer can benefit from a quicker and more convenient transaction time. And if the technology were to become universal, it would eliminate the need for retailers to maintain hardware such as chip-and-pin devices. This is an appealing prospect given the volume of support calls that chip-and-pin devices generate from retailers.
The key for retailers is to make the most out of the technologies that are available. If contactless isn’t on their agenda, then maintaining existing in-store technology and ensuring maximum equipment up-time must be.
Convenience and trust are crucial. Efficient, safe payment, be it through PoS or secure NFC, plays a huge part in the relationship between consumer and retailer.
Contactless may not be the preferred payment of choice just yet, but when the concerns have been fully addressed it will bring huge benefits for consumer and retailer alike.
As high-profile retailers such as Asda adopt the technology, so customers will begin to feel more secure with the method. It is once these anxieties are fully conquered that contactless payment will then really take off.