In 2015, Vadim Smotryaev, Director of the IBA Technical Division, and I were in London to receive an award from the IT Europa’s European IT and Software Excellence Awards for the IBA Automated Fare Collection System. It was the beginning of smart mobility and smart payment solutions that IBA Group has been implementing. The focus of this vlog is Visa’s technology called Tap To Phone.
Mark Hillary, a writer, and analyst focused on technology helps Vadim share his ideas.
Vadim SmotryaevDirector of the IBA Technical Division
People use contactless technologies to pay without touching any POS terminals or cash. This is why contactless technology is becoming more and more popular. From this point of view, adaptation and penetration of digital POS terminals will create great opportunities for the transformation of the way how we make our payments.
Mark Hillarywriter and analyst focused on technology
Apple don’t have cash registers in their stores. The sales assistant comes to you and you pay the assistant directly. But you are saying that this will just become normal. Does that mean that stores will see the end of cash registers, the end of lines to pay, and will just have assistants coming to us?
I looked at your VISA payment system and it seems that it transforms any mobile phone into a point of sale device, which could be transformative for small businesses that want to accept cards. Could you just tell me about the main features of the product and how long you have been working with Visa on this?
– Tap To Phone is a technology provided by Visa and it’s a really exciting technology, which can transform the existing payment ecosystem into a new one. To accept payments, you need only an NFC-enabled smartphone. That is enough. It means a big opportunity to create new possibilities for your business. It is a new way of service, a new way of shopping for everybody.
Contactless technology was introduced more than ten years ago. Today, it is popular among customers and merchants. I know many people who love using Apple Pay, Google Pay, and any kind of contactless technologies. Why? This is thanks to the simplicity, reliability, and safety of this technology. It is very convenient.
What do we see now? There are about two billion Android phones in the world. This means that Tap To Phone can transform these two billion Android phones into POS terminals. It creates good opportunities for everybody because sometimes it is not easy to start accepting contactless payments. What you need now is just to download an app, register, and you are ready to accept payments. It means that we create a digital POS terminal. This is a fantastic opportunity.
Our product is called tapXphone and it meets all the requirements of the Visa Tap To Phone program. It has some really interesting features. I’m talking about the PIN on Glass technology. For bigger amounts of money, a PIN should be entered and thanks to the PIN on Glass technology, any customer can enter a PIN on a merchant’s device. It breaks all barriers in adopting this technology in the broad sense of the word.
It means that you do not have to change your shopping habits. You can pay by your beloved contactless device in any shop without any new user experience. It becomes a very standard way.
Another thing I would like to emphasize is that our tapXphone is a digital POS and it means that this is software. Hence, it can be integrated with other software. It creates big opportunities to spread out this technology among a huge number of mobile applications for merchants.
I am talking about different small applications. For example, you have a delivery service, you have your application, and sometimes it is convenient to integrate this functionality inside your mobile application rather than use different applications and different hardware. Therefore, it creates a new experience for merchants as well.
If I am buying a ticket from a conductor, do I need to enter my PIN on his or her phone?
– Irina, are you asking me about our experience in transit solutions? It is also an interesting story and a new niche for digital POS. In the case of transit, it is another story. Usually, transit and ticketing do not require big amounts of money for rides and in this case, you will not be obliged to enter your PIN. If you’d like to buy a new mobile phone or new clothes and the price for these purchases is higher than for a ticket you can be asked to enter your PIN.
I mean it sounds like a big opportunity because it is not just contactless but it can also accept payments that need PIN as well. You mentioned billions of devices out there. Could you see a guy selling hotdogs on the street using this for payments?
– Yeah, thanks to digitalization new niches for this technology will open soon. One of the barriers to contactless technology in the real life is the cost of the required hardware and technical maintenance. In this case, for some micro, mini, and small merchants, it could be a problem. This technology is focused on these niches of business. There are many small traders, and every small merchant on the street wants to expand their business. Sometimes it is more convenient to accept a contactless payment rather than cash.
From the point of view of consumers, it is often not so much a matter of method of payment but rather a question of what service you will receive from this merchant. Some people like me prefer to use contactless payments. I like this type of payment and not cash because with the cash you need to manage many extra things. Therefore, I prefer to use my smartphone for payment or a contactless card. It is more convenient for me. It means that there are consumers who want to use these contactless payments and from the perspective of micro and mini merchants it is a good possibility to increase their business opportunities.
This is the first part of our vlog series on smart acceptance technologies. Get in touch with us, if you are interested in learning more about our new contactless payment solutions. Please share your thoughts and offer your topics for future videos by leaving your comments or suggestions here.