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Mike Duffy is the president and CEO of Chase Paymentech, a subsidiary of JPMorgan Chase (JPMC). Paymentech is a leading provider of global payment processing and merchant acquiring. The company’s proprietary platforms enable integrated solutions for all payment types, including credit, debit, prepaid stored value and electronic check processing; as well as digital, alternative and mobile payment options.
Even in good times, owning a business can seem like a never-ending struggle to stay ahead of the competition for customers. Every business begins with a core objective to sell a good or service, but commercial success is about much more than just a good idea. It also depends on a business owner’s ability to reach customers and meet their needs more effectively than the “other guys.”
The way customers pay for goods and services is continuously evolving, and in a competitive environment, businesses must adapt or be left behind. As your business seeks to adapt to the ever-changing payments landscape, here are three technologies that will make it easier to serve your customers.
Traditional forms of payment – such as magnetic-stripe payment cards – continue to account for the vast majority of electronic payments in the United States, but this is beginning to change. More card issuers are introducing EMV (Europay, MasterCard, Visa) cards with embedded microchips that make the card less susceptible to counterfeit and extremely difficult to copy because the encrypted chip enables safer processing and the storage of data.
Payment networks are a major driver of this new technology, which has been used in Europe, Canada and elsewhere for years. Merchants that accept EMV-chip cards can expect fewer chargebacks and may have little to no liability in the future for the cost of card fraud – saving them time and money.
It’s estimated that more people around the world own cell phones today than toothbrushes. And smartphones, which can be used for almost anything, are ushering in a new era of commerce as an increasing number of smartphones are capable of making mobile payments. In fact, mobile payments are expected to grow at a 68 percent compound annual growth rate between 2010 and 2015, according to Aite Group.
However, there are many ways in which businesses can accept mobile payments. Carrier-based billing allows customers’ purchases to be added directly to their wireless bills. Mobile devices enabled with Near Field Communication (NFC) technology can make payments simply by waving or tapping the phone against a contactless reader. In fact, NFC technology has been a contributor to the rise of mobile wallets, which not only give consumers a new payment option, but provide merchants the opportunity to strengthen loyalty with customers through integrated discounts and rewards programs. These new platforms can help businesses reduce costs, increase customer traffic, and introduce new ways of doing business.
Businesses can also use smartphones to accept payments from customers, especially when a transaction takes place outside of a brick-and-mortar business. Such freedom is a huge asset for businesses in need of the flexibility to serve customers anywhere – from food trucks to pop-up stores and everything in between.
When considering mobile payments acceptance, merchants need to consider the optimal hardware and software, as well as which company is providing the service. Questions such as “does the device have a card swipe feature?” or “can the software send receipts electronically by email or text?” are important considerations for business owners to ensure an optimal customer experience. Mobile payments acceptance can be a game-changer for a business currently limited to accepting only traditional forms of payments. Assessing whether mobile acceptance is right for your business is worth the research.
We live in a time when new innovations are being introduced at a dizzying rate. Emerging payments and acceptance options are gaining in popularity. As customers find new and innovative ways to pay for goods and services, business owners who embrace the opportunities created by new technology will reap the benefits. Don’t wait and find yourself scrambling to catch up. Spend the time now educating yourself and preparing your business for the future. Learn more about the options available to you by visiting www.chasepaymentech.com/futureproof.
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