Top secure payment system trends for 2016
Seemingly every year, a new form of paying for goods and services is released or introduced. Merchants are constantly searching for secure payment systems that put their companies ahead of competitors while still providing safe transaction methods for customers. To be considered secure, purchase techniques have to fit four criteria:
- Must verify that the transferred information was generated by the signed author.
- The communication must be private.
- Must ensure the client and the server are who they claim to be.
- The communications must not be changeable during transmission.
There are certain secure payment systems that are on trend for 2016. These methods are the most recent techniques and often offer merchants an advantage over competitors in their industry.
This type of secure payment system is quickly gaining in popularity and is on target to be just as important in 2016. The total value of a mobile payment will grow 201 percent next year, as mobile payments will total $27.05 billion in the U.S. alone. Using tools like Apple Pay, Google Wallet and other near-field communication techniques, merchants will be able to make the transaction process easier for consumers while offering better customer service and enhancing client experience.
Businesses hope to use mobile payments to engage their customer base on an increased loyalty level. Marketers can share promotions, discounts and incentives with consumers via their mobile phones, encouraging clients to continue shopping with the same company over time. Accepting mobile payments allows entrepreneurs to create a direct relationship with their audiences and develop a seamless way for customers to purchase items online with just a few clicks.
Similar to mobile payments, wearable devices are another way for customers to easily make purchases. This secure payment option will continue to gain traction in 2016 as more credit card providers release information about their own wearable prototypes. Last October, for example, MasterCard announced its wearable payments devices in the form of rings, wristbands and key fobs. Each device has a unique identifier which is tied to each user's token for every transaction, increasing the security of the payment system.
Wearable technology offers more than just increased transaction efficiency, however. The secure payment system can actually improve company productivity if the devices are built with business practices in mind. While consumers can use the devices to quickly pay for goods and services, companies can utilize wearable technology to keep track of inventory and enhance customer data collection. The wearable secure payment system technology market will be worth $11.61 billion by 2020.
By now, most merchants are familiar with EMV chip cards as a secure payment method. Starting on Oct. 1, 2015, merchants may be held liable for certain fraud related chargebacks if they process chip cards on a terminal that is not EMV-enabled. Companies are now responsible for ensuring their customers are protected. The safest way to do this is to implement a point of sale system that has a chip-enabled reader for the cards. While the switch is not mandatory for businesses, the transition will save enterprises money in the form of penalties from their acquiring banks in the case of stolen or counterfeited information during a purchase.
Since the change is fairly recent, EMV will continue to be a trend in secure payment systems in 2016. In fact, there is another planned shift coming in October of this year. MasterCard recently announced that by fall 2016, banks will be able to hold ATM merchants responsible for fraudulent withdrawals or cash advances. This shift is a way for credit card providers to cover the least secure channel.
It is crucial for merchants to stay up-to-date with the most recent and popular secure payment trends. These methods will help companies remain competitive in their industry while also providing the best level of customer service to consumers. For 2016, mobile payments, wearable technology and EMV cards are some of the favored options for businesses.
These three forms of secure payment systems will streamline the purchasing process for clients and enable enterprises to improve their own practices as well. Each trend offers enhanced security while meeting specific security standards, including compliance with the Payment Card Industry Data Security Standards. These 2016 front-runners are the secure payment systems merchants should keep their eye on.