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mPOS is the key to mobile payments adoption

The day when people leave their wallets at home and use their phones or tablets for all their financial transactions is on the horizon. What the founders of many FinTech companies are pondering, is just when people will reach this horizon and what will get them there. The answer to the latter part of the question, in my opinion, is mobile point of sale (mPOS) technology.

mPOS is the key to making consumers and merchants comfortable with using mobile phones for everyday financial transactions. It is the bridge between traditional card payment and full mobile payments technology, such as the mobile wallet. mPOS companies are also the catalyst for innovation in the wider mobile payments space. The experience of navigating complex financial regulations and designing intuitive financial products has created a generation of highly skilled developers who can use their skills to help the rest of the mobile payments industry.

By any measure, the mPOS space is growing incredibly fast. For merchants and businesses, mPOS systems are an attractive option because they offer a flexible and thoroughly affordable means to accept and process card transactions, while still presenting users with a recognisable interface. Unlike traditional card payment companies, which use bulky and static card terminals, mPOS solutions harness the technology which already exists in users’ phones and tablets.

Accepting card payments is traditionally expensive and complex, and thus a real problem especially for small businesses. The leading mPOS companies are changing this rapidly and are building a huge merchant base through easy on boarding procedures and a simple and cost-effective product that is intuitive to use. An integrated POS solution that used to cost thousands of dollars is now available in a transparent and affordable pay-as-you-go model. This is an exceptional value proposition for anybody who runs a business. It is also the foundation for a platform offering entirely new value-added services, such as real-time CRM solutions.

In short, businesses are driven to use mPOS technology because it makes sound commercial sense. The final part of the puzzle required to ensure that mobile payments are fully accepted is linked to assuaging security concerns. This is simply about educating people and normalising the idea that mobiles can be used to pay for goods. The established mPOS companies are working closely with financial organisations such as MasterCard and Visa and as a result, are fully certified by major credit and debit card players. Some companies, including SumUp, are also licensed by the FCA. The combination of these measures ensures that payments are processed with the highest security standards for card payments.

As businesses increasingly use mPOS, more and more consumers will be confronted by the technology and feel comfortable with involving smartphones in financial transactions. It is then only a short leap for consumers to consider using their own phones in the payments process a reasonable option. This will drive open the door to the whole mobile payments technology space. Put simply, the future of the mobile payments space is dependent on mPOS technology gaining widespread adoption. If current trends continue, this moment will be at hand soon and spark a revolution in how we all pay for goods and services.




Comments: (1)

A Finextra member
A Finextra member 07 April, 2014, 13:28Be the first to give this comment the thumbs up 0 likes

Good article...

The problem is though that card payments, even through mPOS, are still expensive. There is a floor that they cannot go below, and that floor is still high for many SMEs. This is why almost all mPOS providers oeprate at the same costs for a business, there is no difference.

Unfortunately, even squeezing interchange fees and the profits of the card schemes makes little difference. Fees are set based on issuers, card schemes and aquirers...

Mobile payment adoption is not down to mPOS nor interchange, nor even distribution initially, rather its down to a sound offering for both consumers and businesses that adds value to their experiences...Then, its a matter of distribution...

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