Our mobile devices are capable of doing much more than being a means of communication. Connectivity has paved the way for our having cashless societies. There is no longer any need to carry around plastic cards or even banknotes as you only need a cell phone or a tablet for nearly all payment transactions.
The most common way to use a mobile device for financial transactions is by using an app that functions as an e-wallet. There are several apps designed for specific purposes. Some of these are for mobile banking, store payments, and other payment methods. As we step into the future of a cashless society, we have integrated payment systems such as card payment solutions through apps. Our mobile devices have the capacity to send money and make payments, depending on the digital payment infrastructure that exists in the area.
There are multiple ways to pay using our mobile devices such as:
Near-field communication. Also known as NFC payments, the transfer of payment to complete the point of sale transaction is contactless. It works using the close-proximity of radio frequency identification for communicating the payment transaction details between the mobile device and the terminal.
QR code payments. ‘Quick response’ codes work with certain types of apps that have an associated card. These apps include those for banking, stores, and money services providers. For example, in-store payments are made through a QR code. By opening the app and scanning this code at the checkout counter, the transaction can be completed. At times, QR codes for payments are discount vouchers.
Internet payments. These are a form of remote payment that is done using a mobile browser or within apps. To pay for an order, card details are entered, or one uses a money services app to charge the payment to an attached bank account or card.
Mobile wallets. These e-wallets, also known as digital wallets, store the payment information in an app. The kind of data it may save includes that of debit/credit cards and loyalty cards. The e-wallet uses different types of technology for the payment process, such as that of near-field communication (NFC) to hover the mobile device in front of contactless card machines.
Sound wave-based. A payment transaction can be processed without being connected to the Internet because of the installation of this sound signal-based software. Unique sound waves that contain encrypted data are sent from that payment terminal to a mobile device to convey the details. The mobile device then converts that data into signals that will finalize the payment transaction.
Magnetic secure transmission. This method of payment using a mobile device replaces the magnetic strip found at the back of debit/credit cards. The mobile device emits a magnetic signal that mimics the magnetic strip located on the back of a debit/credit card. The payment terminal gets the signal, and the magnetic secure transmission (MST) transaction is processed.
Technology has brought us to the point in time when we can make cashless transactions. There are multiple ways to pay using a phone, whether you are connected to the Internet or not.