Small businesses and mobile payment technology: What's out there?

Mobile payments are becoming more popular every day, and are changing the traditional relationship between business size and available markets on a global scale. Continued developments in the fintech industry are giving small businesses more exposure by simplifying complicated banking procedures, such as international money transferand helping to lower the bureaucratic barriers that have traditionally complicated trade.

Recently, Toast, a Boston start-up, raised $30m US dollars to develop its already-successful Android platform for online restaurant ordering. The rise of contactless payments continues to change the way buyers and sellers interact – is now the time for small businesses to get in on the mobile payment action?

Benefits

Tap-and-go tech, whether in the form of wearable payment devices or contactless cards, could make cash a thing of the past. This age of ‘borderless transactions’ has made it easy for small businesses (and consumers alike) to bypass bank and currency-conversion fees. Adopting mobile payment tech therefore translates to reduced costs for businesses and are underpinned by, lower prices for consumers.

Mobile payments are also becoming increasingly fast and hassle-free. China’s Alipay now supports facial recognition login, while other payment giants like MasterCard are already running a pilot scheme known as ‘Selfie Pay’ – users take a selfie to purchase an item, eliminating the need for signatures or pin numbers.

Risks

Cross-border transactions ultimately involve data exchange, from a consumer’s shipping address details to the information on their card. Demonstrating an ability to secure this information will be crucial to the continued growth of the entire fintech sector.

Many companies are already addressing the security concerns associated with new payment methods. Small business owners may want to look into mobile payment software that encrypts at the hardware level, for instance. These programs ensure that customers’ card details are converted into code before being sent for processing, adding an extra layer of security to prevent payment fraud.
 
Firms should make sure that their chosen mobile payment software has Payment Card Industry Data Security Standards (PCI-DSS) certification. The PCI keeps its members up-to-date on potential threats and vulnerabilities in the entire payment card ecosystem, and offers effective training and certification for businesses that want to stay on the cutting edge of mobile security.
 
If you're thinking of going global with your business, make sure all your money transfers are handled through secure and trusted brokers. For more information on developments in the latest payment tech, keep updated with The Money Cloud’s blog.

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