Commentary
The Challenge of Mobile Payments at Small Merchants
- by Chuck Martin , Staff Writer, June 14, 2013
For anyone looking to small businesses to be a key driver of
mobile payments there’s good news and bad news.
The good news is that the number of small merchants using a smartphone or tablet to accept credit card payments has almost doubled from 10% last year to 17% now.
The key reasons cited for going mobile was the ability to accept payments from any location, though 63% say they have not replaced their traditional point of sale equipment with their smartphone or tablet system.
The small merchant and mobile payments survey, the 2013 Survey on Technology Awareness and Adoption, was conducted by ControlScan and TransFirst
The survey of 1,650 merchants included those in retail and consumer goods, healthcare and human services, personal and professional services and restaurant and hospitality.
The not-so-good news for mobile payments is that small merchants show little interest or readiness for mobile wallet payments to close transactions.
In the mobile wallet department, only a small number (3%) accept them and of those who don’t, almost half (47%) have no plans to do so in the foreseeable future.
Of those who have implemented payment acceptance solutions, Square tops the list:
- 60% -- Square
- 19%-- PayPal Here
- 17% -- Intuit GoPayment
- 2% -- First Data POGO
- 1% -- Group Now
Back to the good news department, of those who have implemented mobile payment solutions, most (64%) are satisfied.
The study shows the key drivers of mobile payments adoption to be customer demand and customer convenience and merchants don’t’ see those factors as present.
More than half (60%) see no compelling reason to make the investment in mobile payments. And there is the challenge with mobile payments.
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OMMA mCommerce, July 15, New York. Pandora, MasterCard, Joule, ScanBuy, Huge, Spyderlynk, Rue La La, BYNDL, Catalina, Giant Eagle, Payvia, Ansible, Moxie Interactive coming. Here’s the AGENDA.
Chuck Martin is Editor of the AI & IoT Daily at MediaPost and writes the daily Connected Thinking column. He is a NY Times Business bestselling author and his latest book is “Digital Transformation 3.0” (The New Business-to-Consumer Connections of The Internet of Things.) He is CEO of Net Future Institute and a frequent keynote speaker internationally. Follow him on Twitter @chuckmartin and contact him at Chuck@MediaPost.com.
Count me as one of the 64% that is very satisfied with our credit card acceptance through Square. With our other credit card processors, we have had nothing but hassles, hidden fees, ever-green clauses which make it impossible to cancel services, etc. I could write an essay about accepting credit cards from standard vendors. One story will suffice: Out of the blue, some representative from MY credit card processor called me on the phone and said that because we have had no complaints and no charge-backs, we qualify for lower rates. I sat down with the charlatan, and over coffee, he showed me a whole bunch of numbers I did not understand or comprehend. But at the end of it, he said I'd be saving a good deal of money. So I updated my credit card program per his recommendation. (Remember, I was not switching vendors; just updating my current contract.) The net payment to the credit card company went UP by 10% not down. I was over the Moon with anger at this man.
Needless to say, we switched to Square which has NO monthly fees, and NO contract. And their processing fees are very competitive. And you can quit them at any time.
Square is the only honest credit card processing company I have ever run into. Personally, I wish nothing but curses on the rest of the entire credit card processing industry.
Thanks for sharing your experience, Paul. Ouch!