Retailers are used to having to change or update their payment systems over time, but a major change is coming up which means many of the current point-of-sale systems they are using will not just become obsolete, but could leave them at risk of liability for fraudulent transactions.
PCI compliant terminals are an important part of a retailer’s business and once the new V4 terminals come in to use in April next year, the V3 ones that are currently used by retailers will no longer be supported. It is a process the industry calls 'sunsetting,' and retailers need to start looking at the alternative payment systems they can use now so their transition from one system to another can be seamless.
Doing nothing is a very dangerous option, as continuing to use an unsupported POS systems — i.e. without software updates to ensure compliance with legislation and the latest security protocols — they would end up footing the bill for any fraudulent transactions made through their terminals.
So, now is a very good time to look at the wide variety of payment system alternatives that are currently in the market. There are around 900 different payment terminals globally, and the one that was right for your business previously may no longer be appropriate. It really depends on how your business works.
Most retailers now have an online presence, which is essential to garner market share for their business as the buying habits of consumers change. Worldwide, 2.8 billion people are buying online, up 3.1% from last year according to data from We Are Social and the trend is set to continue.
Failing to access this market effectively means putting your company’s future at risk. There are many retailers that have failed because they didn’t follow the move online quickly enough — ToysRUs, Blockbuster, Eastman Kodak and the U.S. bookstore chain Borders to name but a few.
So, it is vital for retailers to consider their online presence, and also look at the various ways that people are able to pay for goods and services both online and offline. Customers are using everything from credit cards, debit cards and mobile wallets such as Apple Pay and are always keen to adopt new, easier and faster — but still ultra-secure — ways to pay.
While it may be tempting to think of upgrading your new POS system in isolation, you should also consider how your customers are interacting with you. Is your online presence strong enough, or could be made stronger? Also, would a more integrated payment system for both online and offline payments make more sense for your business?
Even in store, the number of ways customers look to pay is proliferating. For example, contactless seemed like an amazing innovation when it arrived back in 2007 and while it took some time for people to feel comfortable with it, contactless payments finally outstripped chip and PIN payments in the U.K. in June last year. But that is the tip of the iceberg. People are now using their smartphones, watches and facial recognition to pay for good and services, and these advances in technology show no sign of abating. If retailers want to keep their customers happy, and coming back, they need to consider these options going forward. They need to use a system that is future proof because it develops as the technology develops.