The Payments segment is the epicenter of all the transformation orchestrated by digital technology. The transaction value of the digital payments market was $5.44 trillion in 2020 and is expected to reach $11.29 trillion by 2026, registering a CAGR of 11.21% during 2021–2026. Fueling this growth are numerous factors including rising adoption of smartphones, improved internet penetration, and increasing preference for digital solutions. Payments is witnessing massive innovations—new payment options now range from biometric authentication and QR codes to mobile point of sale (mPoS) and smart speakers. SoftPoS is a relatively new payments system gaining acceptance.
Software point of sale or SoftPoS is a disruptive technology redefining the payments space. It enables individuals and merchants to accept contactless payments from cards or near-field communication (NFC) wallets on their smartphones while capturing financial PINs and additional authentication as per requirement. SoftPoS cuts out additional hardware by transforming the phone into a payment terminal. Merchants or individuals can simply download the software and turn their NFC-enabled Android mobile device into a payment acceptance device. Small and mid-size businesses and merchants can leverage SoftPoS on their smartphones to accept digital payments without making additional investments. However, SoftPoS solutions currently work only on Android.
The evolution of SoftPoS is quite interesting. Plastic payment cards surfaced in the middle of the last century. Merchants invested in specialized hardware—PoS terminals—in order to accept payments through these cards. Over the years, PoS terminals have evolved and significantly reduced the time required to process a card payment. More recently, PoS terminals have reduced the need for special connections to banks and expensive equipment. Increased functionalities of PoS terminals provide robust solutions that go beyond payments.
Increased mobile phone penetration fueled the development of mobile PoS terminals. These terminals enabled merchants to connect to a mobile device and then communicate with the card platforms. They lowered the cost for merchants and addressed the issue of having dedicated lines to connect to banks. However, in all the above cases, users required additional hardware to accept card payments. Enter SoftPoS, a technology that does not require hardware for making payments.
Any new technology or innovation gains acceptance only if it is easy to use, is seamless, has an appealing interface, and complements the existing ecosystem. SoftPoS checks all these boxes and generates significant value for the stakeholders in the ecosystem.
Governments worldwide are well on their way to a ‘less’ cash society. The COVID-19 pandemic accelerated the shift to contactless digital payments. In 2020, Mastercard partnered with Worldline India and Axis Bank to launch a SoftPoS solution to help offline merchants and mom-and-pop stores accept payments using their smartphones. Correspondingly, Visa released certification standards and launched the Visa Tap to Phone program in October 2020.
SoftPoS is an easy-to-deploy solution for low-value transactions and is a good fit for micro-merchants. Especially in the backdrop of the current landscape, small and micro-merchants can accrue significant benefits from SoftPoS and ably provide their customers with a seamless and cost-effective checkout option.
To learn about Prove’s identity solutions and how to accelerate revenue while mitigating fraud, schedule a demo today.
Trusted by 1,000+ leading companies to reduce fraud and improve consumer experiences. Contact us today to learn how you can frictionlessly secure your digital consumer journey — from onboarding to ongoing transactions.
Tap the button below to read our latest white-paper on the subject as industry leaders.
Contact us to learn how leading companies are using Prove Pre-Fill to modernize the account creation process by shaving off clicks and keystrokes that kill conversion.
Get in touch to find out how we can help you identify your customers at every stage of their journey and offer them seamless and secure experiences.
Let our expert team guide you through our identity verification and authentication solutions. Select a date and time that works for you.
Find out how we can help you deliver seamless and secure customer experiences that comply with PSD2/SCA. Select a date and time that works for you.
Download Aite-Novarica Group’s full report about Prove Pre-Fill, including a product overview, customer results, and how the product works.
Download the guide now to learn how you can improve security, cut down on fraud, and create the best possible customer experience.