Latest studies by Statista show that 75.8 million smartphone users in the U.S. scanned a QR code in 2021. This number went up by 15.3% compared to 2020. The use of mobile wallets and online payment technologies improved significantly in the last decade, thanks to the increased adoption of smartphones. However, this usage was further fueled by COVID, making contactless payments the go-to payment method for most retail consumers.
QR code payment is no longer revolutionary payment technology; instead, it is pretty common among retail business owners. More than a million small businesses in the U.S. use QR code technology to accept payments. So, what are QR code payments, and how can you get started with them?
QR code stands for Quick Response code. This technology was initially introduced nearly three decades ago in 1994 in Japan. However, for the first decade or so, it was not very popular, and it picked up the adoption only after the rise of smartphone technology and mobile payments.
A QR code is a 2D barcode that instructs the scanner to perform a specific function. You can look at QR codes as hyperlinks to a website/application on your phone. Instead of typing the entire hyperlink in a browser application, you scan the QR code to access the relevant information. Some applications of these codes include:
A payment QR code redirects your smartphone’s browser to a hosted payment page or opens a mobile payment application for you to authorize and complete a transaction.
Most modern-day default smartphone camera applications have an in-built QR code scanner. However, in some cases, the consumer may need to scan the QR code through a dedicated application like Google Lens, Google Pay, or Apple Pay to carry out the payment. Consumers can scan the codes from photo libraries like Google Photos or Apple Photos, too.
Our referral partners seek to meet the evolving needs of their merchants when accepting payments. To create retention in the merchant portfolio, professionals who want to offer a strategic payments strategy to a business to business, small or mid size business, or even publicly traded corporation, digital fintech will remain necessary. This will involve delivering products like QR codes that are a part of a contactless, faster, easy to set up, reliable, and secure payment platform.
Contactless Payments: The need for contactless payments has grown multifold since the COVID pandemic. Merchants can offer touch-free QR code payment methods to consumers to prevent the further spread of the virus.
Faster Payments: Merchants benefit from real-time payment acceptance with the combination of faster payment systems with QR codes.
Easy Setup: Most mobile payment applications can generate a payment QR code within seconds. Setting up a new QR code does not require any additional expensive hardware. Advanced applications used at point-of-sale terminals can also prompt the scanner to generate a dynamic QR code that automatically inputs the total billed amount in the code. Consumers do not need to enter the final amount after scanning but directly authorize the transaction with a simple click for such codes.
High Reliability: These codes are highly reliable. Scanning QR codes will take the consumer to the correct payment link on the hosted payment portal or application every time. These codes eliminate the risk of mistakes while manually entering the payment link in a browser.
Enhanced Security: QR code technology continues strengthening in its technical structure for reliability and security. Modern-day payment applications have a safety filter that prevents the code from automatically deducting any amount from the bank accounts without explicit authorization from the consumer.
Business owners and individuals use QR codes today, and generating a code does not take more than a few seconds. Moreover, one can download a reliable free QR code generator from the Android or Apple app store. Some payment apps like Google Pay and Paypal also generate a QR code in real-time. Organizations looking for merchants using these payment codes may find that consumers use them at fuel stations, ticket booking websites, toll payments, parking payments, micro-businesses, and retail merchants. Even street vendors have started using QR codes to accept payments quickly.
QR codes are generally safer than manually entering a website link in a browser application, since the latter is more prone to human error. However, the ultimate safety of the transaction depends on the consumer’s discretion. As mentioned earlier, a QR code cannot automatically deduct any amount from the bank account without explicit authorization from the scanner first. The payments via such codes usually go through the secure card network (for debit or credit card payments) or a safe hosted payment portal (for online ACH payments). Here are some tips to prevent a QR code fraud:
Also, QR code payments usually have layers of tokenization and encryption to prevent fraud.
Start business owners with QR code technology with minimal setup. Some financial institutions have their own custom mobile applications that generate these QR codes to help merchants accept payments. This gives the merchant the ability to ask the customer to scan this safe QR code and complete the payment. In most other cases, merchants partner with reliable payment technology gateway providers to set up an application that helps them generate dynamic QR codes. Using this technology, merchants can modify or generate unique QR codes for new transactions within seconds.
A business merchant needs a payment provider to bring in payment technology. A QR code application only helps the merchant develop a QR code to accept payment. Merchants must partner with a payment processor to receive and process payments to their bank accounts. The top payment processors help merchants get payments via different methods like credit cards, debit cards, and ACH. Moreover, they help merchants set up complementary payment technologies to enhance the end-consumer experience further.
Using iCG as the Preferred Payments Provider, they set up a virtual terminal for the merchant to manage and access all transaction data in real-time. Learn more about the most innovative industry-specific payment solutions in the market here.