BUSINESSES will be able to make customers’ lives easier this year as banks introduce new payment methods, hastening the move towards a “cashless society”.
Within the next three months, Absa will roll out its Payment Pebble with local payments innovations company thumbzup.
A small device that can be plugged into the audio jack on Android, iOS or BlackBerry smartphones and tablets, it is similar to a solution First National Bank (FNB) previously announced it was working on with the UK company mPowa.
The FNB/mPowa device is yet to be released to the market. A spokesman for FNB said there had been no further developments since announcing the partnership in October.
The Pebble, together with a dedicated mobile app, will transform smartphones into mobile point-of-sale devices.
The system could be beneficial to small businesses, because it negates the need for traditional point-of-sale devices and their high fees.
Although Absa will only release pricing information when the Pebble goes live, the thumbzup website said the device itself was “sub-$40” (about R350).
“The Pebble was built with the intent to service businesses that today either cannot afford the traditional point-of-sale solutions or, due to the mobility aspects of their business, are unable to collect credit or debit card payments,” said Stafford Masie, thumbzup’s CEO.
“Think about the plumber, electrician, pool and garden services, delivery man and even the variable billing of a babysitter.
“These are the folks who are outside the system today — Absa estimates this number to be approximately 400,000 — and one of their greatest challenges is revenue collection.”
Regarding the safety of the Pebble, Mr Masie said it would comply with the highest certification requirements.
He said the absolute minimum security level for the device was the same as the requirement now in place for traditional point-of-sale devices.
Standard Bank is trying out its Muvo transit card in the eThekwini municipality, aiming to put an end to carrying cash for bus fares. It is similar to the card that Gautrain commuters use.
Absa has a comparable offering for Cape Town’s MyCiti bus service. The Absa card has also been tested in Johannesburg.
The cards look set to make the leap into the retail space because they can be used for low-value payments.
They carry the MasterCard PayPass logo and have antennas embedded in them. The antenna allows customers to pay offline at point-of-sale devices displaying the same logo as their card by simply tapping the card against the terminal.
Customers do not need to give the card to the cashier, enter a PIN or sign a slip for payments of less than R200, which mean they can keep their card with them at all times. To ensure security, a PIN will be required for purchases above R200.
Kershia Singh, a spokeswoman for Standard Bank, said merchants could upgrade hardware and software on existing point-of-sale devices to make them compatible with the PayPass technology.
Late last year, Absa launched Potentiate, an offering for tech-savvy professionals, which uses the PayPass technology.
Its MasterCard Titanium card has a button and digital LCD display that provides a one-time PIN for added security when shopping online at participating 3D Secure merchants.
The card allows clients to transact on any of their underlying credit, cheque and savings accounts. The offering includes an Apple iPad.
FNB’s GeoPayments, available on its banking app for smartphones, holds promise as a business payment solution.
Farren Roper, FNB Connect’s head of ISP and business operations, said the service used global positioning system technology to enable cashless payments.
Asked what this meant for businesses, Mr Roper said: “GeoPayments is currently intended for consumer app-to-app payments, but it does create interesting possibilities for person-to-business payments, especially with our merchant network.”
Mr Roper said GeoPayments was the sixth most popular financial transaction on FNB’s banking app and had ample room for further growth.
“GeoPayments will in time become the most popular way to make once-off payments from app to app, because a payment can be made in three easy steps,” he said.
* This article was first published in Sunday Times: Business Times