Payment technologies have rapidly advanced in recent years. Cards with magnetic stripes are fast becoming obsolete. What’s replacing them are cards with EMV chips known as smart cards. Today, most banks have adopted the new payment tech and are issuing them to customers. The upgrades offer a number of advantages. By switching to cards with integrated chips, customers enjoy better security and experience.
Magnetic stripe debit/credit cards are plummeting because of their many flaws. They are inconvenient in a post-pandemic world. Presently, customers are receiving and using chip-based cards. And if you’re still using magnetic stripe reading terminals, it is high time to upgrade your POS terminals.
Providing customers with a hassle-free shopping and checkout experience is good for business growth. You can raise customer satisfaction levels using a world-class POS system that integrates with an EMV chip-reading POS terminal. In this article, we discuss the difference between payments through traditional and smart cards. And why accepting smart card payments is essential for retail growth. Let’s get started.
Why cards that use magnetic stripes are declining
The magnetic stripes in traditional cards contain all the confidential information in those single strips. There are many shortcomings because of that and because it uses magnets. Let’s go over them in detail.
Given the ongoing pandemic, technology is attempting to turn several daily activities into touchless processes. Cards with magnetic stripes cannot function non-contact. Only by swiping them can stores complete transactions.
As the data a traditional card holds is magnetic in nature, it is at the risk of getting corrupt. Strong magnetic fields disrupt the information in the card, rendering it useless.
The payment data that passes on from the magnetic stripes of the cards onto POS terminals is static. It is also easily retrievable and transferable to decoy cards. Thieves find it easy to clone the information from the stripes to other cards.
- Cards with magnetic stripes require a working internet connection on the receiving end to complete transactions. Without a network, the cards cannot transfer funds.
- What are smart cards? – 100
Advantages of using smart cards
The EMV chips in smart cards are a game-changer. Just like how the magnetic strip in traditional cards contains data, the chip in the new cards contains all the data. That said, there are key differences between the two types of cards. Let’s discuss what they are.
Smart cards do not reveal the confidential information embedded in their chips. They are secure with cryptography. These cards complete transactions when customers hold them close to the POS terminals. As the data in the chip remains hidden, it is difficult for thieves to clone it. As a result, smart cards are much more secure than their traditional magnetic counterpart.
Unlike magnetic stripe cards, non-contact smart cards can complete transactions touchless. While contact chip-based cards require insertion into POS terminals, the non-contact cards can perform payments with just a single tap. This way of paying for goods and services is hygienic since there is less physical contact of the card with the surroundings.
Smart cards don’t need the internet to process payments. That is an essential criterion for cards with magnetic stripes to function. POS terminals connected to a POS software system retrieve payment data from chip-based cards only upon additional authorization such as the input of a PIN number.
How to integrate POS with UPI?
UPI stands for Unified Payments Interface. It is a payment system via which individuals can send and receive money instantaneously. Launched in 2016 by the National Payments Corporation of India (NCPI), today it is a widely popular payment method. Accepting smart card payments in retail stores is crucial, and so is accepting UPI payments.
An increasing number of customers are paying for goods and services via UPI. There are various UPI platforms to facilitate the transaction. Some are Google Pay, BHIM UPI, Phone Pe, and PayTM. By using these platforms, customers can leave their wallets at home. Their smartphone devices can complete transactions worth any amount.
Investing in an advanced POS system equips you with the feature to accept UPI payments. That is in addition to accepting debit and credit card payments. Setting up your POS with UPI is a simple process. Firstly, ensure your POS terminal can accept UPI payments. If that’s a yes, then ring up the products in a customer’s cart as usual. When it’s time for payment, select UPI in the payment terminal, and enter the amount the customer needs to pay. The POS displays a QR code.
The customer can scan the QR code using a UPI platform of his/her choice and complete the transaction. The benefits of accepting UPI include:
- Instant credit to your bank account
- No transaction fees
- Fast checkout
- Automated payment confirmation
Customers are switching to smart cards for a more reliable and secure payment experience. Upgrading your POS terminals to hardware that can read the chips on the new cards ensures no discrepancy in payments during checkout. Purchasing a cutting-edge POS solution that integrates with multiple types of POS terminals. It also accepts multiple modes of payments making accepting smart card payments an effortless task.
Get SmartPOS, the ultimate retail Point of Sale solution for all types of stores. It can accept contactless debit/credit cards, cash, cheque, and mobile wallet payments. SmartPOS uses the latest security protocols and updates them regularly to thwart any type of cyber threat. Reach out to us to book a live demo of SmartPOS today.