QR code payment technology provides another alternative to cash or credit card payments and allows customers to pay for goods and services quickly and easily using a mobile device. Offering payment via QR codes provides customers with another flexible payment option in a society that is becoming ever more cashless.
For merchants, providing customers with QR code payment options and other modern payment methods allows your business to appeal to a wide demographic. Once you understand how QR code payments work, you should feel more confident about implementing this innovative payment method in your business.
How Do QR Code Transactions Work?
QR code payments use information contained in a barcode-like image to complete a transaction. A smartphone user can use a QR code app both to make and accept payments. In the same way as with credit card payments, businesses need a merchant account and merchant services in order to accept QR code payments that involve credit or debit card details.
How QR Code Payments Are Made
QR payments can be made in one of two ways:
- The customer scans a QR code provided by the merchant. Once scanned, the customer is directed to a payment page where they enter their payment details or use a pre-installed payment solution like Apple Pay, Google Pay, Venmo QR code payments or PayPal QR code payments to complete the transaction.
- The customer can generate a QR payment code that links to their card details. The merchant can then scan this code so that the transaction can be finalised through their payment gateway.
How to Provide a QR Code Payment Option in Your Business
You can follow these steps to integrate QR payment technology in your business:
- Set up an account with a QR code app to generate a unique QR code for your business.
- Display QR codes somewhere prominent in your business (such as at the till) where customers can easily see and use them. If you are an online business, you can place unique QR codes on each product page or at the checkout.
- When a customer pays using a QR code, they will scan it using their smartphone camera, generally through a QR code app.
- Once the customer has scanned the code, they will be taken to a separate window or app to complete the transaction. The app may be linked to one of their bank accounts or a payment app.
- If the customer uses a mobile wallet, you can also scan a QR code that the customer generated using the app. For this, your business will need either an internet-connected mobile device or a barcode scanner that can scan QR codes.
If you need more assistance with QR code payment systems, you can ask your merchant services provider about QR code payments and whether they offer an app or plugin that can help you integrate this payment option seamlessly into your business.
What Are the Benefits of QR Code Payments?
Businesses that accept payments via QR codes (as with payment by text) provide their customers with a contactless payment method that’s easy and stress-free. Ultimately, merchants should provide as many payment methods as they can to cater to a wide range of customers.
The following are some additional benefits of QR code payments:
- Easy to set up. Accepting credit and debit card payments can often mean purchasing card readers, especially if you have a brick-and-mortar store. In comparison, setting up QR payment services is extremely easy as no additional hardware is required.
- Flexibility. Because scanning QR codes only requires downloading an app, it is easy to roll out this payment method in multiple locations as well as in your online store.
- Answering customer demand. QR codes are becoming more popular, meaning that providing customers with this option should mean happier customers, more conversions, fewer abandoned carts and more revenue for your business.
- Streamline the payment process for the customer and the business. Because the whole payment process is conducted via payment apps on smartphones, there’s no need for physical loyalty cards or receipts. Customers can sign up for loyalty programs via their smart devices, streamlining the process and keeping everything in one place.
Other benefits of QR codes include:
- They can store a large volume of data.
- QR codes can be scanned from screens or paper, making it easy to make mobile payments no matter where you are.
- If part of the code gets damaged, it can still be read, allowing customers to make in-person or online payments even if the code isn’t 100% intact.
Businesses also need to acknowledge that the use of QR codes will likely become more common in the future and start to prepare for that eventuality now. According to the World Bank, steps are being taken in Europe to unify the payment landscape by establishing a cross-platform network, meaning that in the future, payment processing in Europe will become easier for both customers and businesses. Digital payment methods like QR code technology are poised to become an important part of the payment landscape of the future.
Do QR Payments Have Any Disadvantages for Businesses?
Though accepting QR code payments has several advantages for both businesses and customers, businesses should also be aware of the limitations of this payment method. The following are a few things to keep in mind:
- Customers must have the relevant technology to use QR codes. Reading QR codes requires a smartphone that can scan the code and may require the customer to download an app.
- Requires internet connection. Customers with incompatible mobile phones or businesses in places with poor signal or no access to Wi-Fi may have problems accessing the content behind the QR code.
- Mistrust of unfamiliar websites. Scanning a code that leads a customer to an unfamiliar site may cause suspicion or mistrust. Customers may be unwilling to navigate to unknown sites or content that may potentially put their data at risk.
Are There Other Ways Companies Can Use QR Codes to Boost Business?
QR codes aren’t only useful for accepting payments; they can be used in many different ways to boost business. Because a QR code is essentially a way for a customer to open a web page, QR codes can be used to direct customers to anything that’s useful to the business. This could include:
- Linking customers to the business’s website. This could be in-store, as part of an email marketing campaign, or on promotional material.
- Sending out coupons or links to offers. QR codes can save space on print material by linking to the details of a special offer and can be used as a coupon when scanned in your brick-and-mortar shop to encourage more footfall.
- To provide product manuals. This will save money on printing paper manuals and provide the customer with a manual they can easily find.
- Provides a quick link to customer service. Your QR code can link directly to the customer care phone number, web chat service or FAQ page.
- An easy way to download apps. For businesses that use apps, it’s important that customers download them and use them. Using a QR code to link to the app may increase uptake by removing the need for the customer to search for the app in the Apple or Google Play Store.
- Customer engagement. A QR code that offers a reward for going to the linked page—such as a discount code or a special offer—can prompt customers to take an interest and interact with your brand.
It’s worth remembering that while QR code technology can benefit your business in many ways, not everyone will be comfortable using this technology. Businesses with elderly customers, customers without smartphones or people who simply prefer more traditional ways of interacting with your business are a significant demographic that you shouldn’t forget about. With this in mind, it may make good business sense to provide QR technology for customers who wish to use it, but not leave more traditional payment or communication methods behind.
QR Payments Are a Modern Solution for Modern Customers
Choosing to accept QR code payments is a savvy move both for brick-and-mortar and online businesses. Being willing to diversify the way you collect payments means that you don’t shut the door to any potential customers, therefore reducing lost sales. You also encourage customer loyalty by providing a speedy and convenient checkout experience.
Though offering QR code payments is an excellent option for many businesses, they should be offered alongside more traditional payment methods rather than replacing them. Your merchant services provider can explain everything you need to know about accepting payments via QR codes to provide the best possible customer experience.