Smartphones Transform into Retail Payment Terminals in Mastercard Trial
In the ever-evolving landscape of the retail industry, digital strategies are constantly shifting, and one such pivot is exemplified by the Cloud Tap on Phone pilot from Mastercard. This innovative service aims to revolutionise point-of-sale technology by allowing smartphones to function as payment terminals.
Mastercard's foray into contactless technology is not a new development, but rather a significant step forward in shaping the future of online retail. The organisation is encouraging collaboration with solution providers, fintechs, processors, and acquirers, inviting them to co-create cloud-first products using Mastercard's Cloud POS software development kits.
The Cloud Tap on Phone service is designed with a focus on accept contactless payments, a trend that has become increasingly popular in e-commerce. This service not only allows merchants to offer curbside pickup, payment on delivery, or provide line-skipping checkout in stores, but also aims to minimise the need for hardware investments in point-of-sale technology.
Mastercard's pilot for the Cloud Tap on Phone service was announced in 2021, partnering with NMI, Global Payments, and Computer Engineering Group. The service allows smartphones or tablets to accept contactless payments, minimising the need for hardware terminals.
The pandemic has accelerated the adoption of contactless technology, with consumers changing their behaviour and retailers adapting to meet these new demands. According to the National Retail Federation (NRF) Vice President Leon Buck, this shift has been significant. In an August 2020 survey, the NRF and Forrester found that 67% of retail respondents accepted some form of no-touch payment.
Mastercard's move further into the contactless technology space is not unique. Competitor Visa announced an expansion of its Tap to Phone product in 2021, allowing merchants with Android devices to conduct contactless transactions at checkout without additional hardware.
The adoption of contactless payments has seen a substantial increase, with 58% of retailers accepting contactless cards, up from 40% the year prior, and 94% of retailers anticipating contactless payments would increase. Mastercard notes that during the third quarter of 2020, contactless penetration represented 41% of in-person transactions globally, up from 30% a year prior.
In conclusion, the Cloud Tap on Phone pilot from Mastercard represents a significant step forward in the digital transformation of the retail industry. By embracing contactless technology, Mastercard is positioning itself at the forefront of this shift, encouraging collaboration, and minimising the need for costly hardware investments. The future of retail looks increasingly contactless, and Mastercard is helping to lead the way.
