As electronic payments continue to gain popularity across Europe, it is contactless technology that starts to dominate the landscape.
Contactless cards are the most widely-used payment method, but mobile wallets are seeing a gradual increase in consumer usage, too. And with increased hygiene requirements due to the COVID-19 crisis, contactless payment has become even more important.
While consumers are getting to grips with paying via their mobile device, until now this has been a one-way-street. Merchants have still needed a traditional payment terminal and/or point-of-sale (POS) system to accept payments from their customers’ smartphones and cards. This is about to change.
In this article, we want to introduce PhonePOS – the CCV app that turns your Android smartphone into a fully-fledged contactless payment terminal without the need for extra hardware.
Introducing PhonePOS: The Software-only Payment Solution
In 2016, CCV already introduced their own app-based ECR system, named SalesPoint, in Belgium to provide merchants not only payment acceptance but also an easy and fast cash register with product and stock management. Until now, only QR-based payment methods have been fully integrated. With PhonePOS, mobile payments and card payments also become fully integrated.
When Mastercard and Visa announced their pilot programmes for accepting contactless payments on consumer off-the-shelf (COTS) devices in 2017-18, we were quick to get our own software POS (SoftPOS) projects underway.
The logic behind these pilot programmes was that lots of micro-merchants want to accept card and mobile payments, but they don’t want to purchase full-scale terminals. mPOS solutions have become a decent short-term option, but these devices suffer frequent bluetooth connectivity issues – and the merchant also has to wait until their hardware is delivered from the supplier before being able to start accepting payments – although next-day delivery is becoming more common.
Instead, CCV’s PhonePOS solution will allow merchants (of any size) to get started in minutes after being approved by their acquirer, without the hassle of integrating hardware. They can use their own Android smartphone to download the PhonePOS app, and start to accept customer payments immediately.
PIN entry isn’t yet possible on the PhonePOS solution, which means that for contactless card payments, the customer is bound by the payment limits in their country. This limit has been increased in most countries to € 50,- – but this might be subject to change at a later date.
However these limits don’t apply to customers who are using their digital wallet (e.g. Apple Pay, Google Pay, or Samsung Pay) to pay via PhonePOS, because they can verify their identity and ownership of the wallet through a PIN, fingerprint, or facial recognition on their smartphone (so-called Consumer Device Cardholder Verification Method, or CDCVM). Therefore, customers can make high-value purchases when using mobile payment.
Note: PIN acceptance is planned to be added to pilots during the second half of 2020.
Use Cases: Who Could Benefit From PhonePOS?
PCI Compliance: Important Security Measures for PhonePOS
Security is paramount for payment solutions. Everything we launch needs to be PCI-compliant, and the PhonePOS is no different. PCI has its own certification standards for CPoC (Contactless Payments on COTS), and the same security guarantees apply. So you can be safe in the knowledge that PhonePOS is approved by PCI, 100% compliant – and that all transaction data is safe and secure.
The security measures include white-box encryption, real-time back office monitoring, and secure server protection, meaning it’s incredibly difficult for any would-be attacker to make an impact. And our PhonePOS security has also been recognised by Mastercard and Visa to be of the highest standard.
The Next Steps for the PhonePOS Solution
Naturally, we have plans to add further payment schemes, including Germany’s Girocard (in mid-2020) and others. Furthermore, with Mastercard and Visa launching pilots for PIN entry on COTS devices, we’re planning to start pilots with PIN functionality soon. This will push us further towards a comprehensive PhonePOS solution that accepts PIN as well as contactless tap-and-go.