Written by: Kathy Martin, Director of Payment Services, Union Savings Bank
The digital revolution has touched nearly every aspect of business management, and that includes payment processing. Alternative payment options, including some that we at Union Savings Bank refer to as Digital Wallets, are becoming more and more popular among consumers. One of the most well-known Digital Wallets is Apple Pay, which allows consumers to connect their bank debit or credit card to an iPhone, Apple Watch or other supported Apple device. While it hasn’t yet reached the level of use of traditional payment methods such as cash, checks or credit cards, Apple Pay is growing in demand, especially among younger consumers. It is a convenient option for accepting mobile payment both in brick-and-mortar locations as well as online without a significant financial investment from your business. Here are a few of the basics about Apple Pay to get you up to speed on the service, including how Apple Pay works, how it can benefit your business and how you can set yourself up to accept it from customers.
How Does Apple Pay Work?
Apple Pay is based on near-field communication (NFC) technology, which allows two devices to exchange information by being in close proximity to each other. In the case of Apple Pay for business, a consumer uses their Apple device to send payment information to your business through a contactless transaction reader in mere seconds. The system is secure because the card number isn’t stored on the consumer’s device or passed through to the merchant, plus a facial scan or fingerprint authentication with the iPhone’s Face ID or Touch ID is required for every transaction (or a passcode if these haven’t been set up). Apple Pay transactions are also processed with a “card present” rate, which means your business doesn’t have to pay the penalty fee normally associated with running credit or debit transactions without a card present at the time of purchase. There’s no extra cost to you for accepting Apple Pay. The only investment you’ll have to make is purchasing the right Apple Pay terminal – like an EMV terminal or card reader that accepts contactless transactions. If you already have an EMV terminal, you may just need to upgrade your current platform to accept Apple Pay transactions. Given the speed and cost considerations, as well as the added security, it’s definitely worth considering this payment option at your business.
How Can You Set Apple Pay For Business?
Setting up Apple Pay for your business can be broken down into three simple steps:
•Get a contactless transaction reader that’s compatible with Apple Pay – The first thing you’ll need is the right hardware and software to process Apple Pay at your retail locations. If you already have an EMV chip-enabled card reader, then you likely have the right Apple Pay terminal hardware. EMV chip cards (short for Europay, MasterCard and Visa) have become widely implemented because the technology makes it more difficult for fraud. Most EMV readers are also Apply Pay compatible or may just need a software update to become compatible. Contact your payment provider to ask about getting the right hardware/software configuration or confirming that your current set-up will accept Apple Pay.
•Integrate Apple Pay onto your website – In addition to accepting Apple Pay at your brick-and-mortar retail locations, you also have the option of setting up Apple Pay on your website. While not a requirement to accept payments at your physical stores, it’s worth considering the option for your e-commerce site if you conduct a lot of online transactions. Your online customers wouldn’t have to input a credit or debit card number on your website, so they would experience the same convenience and security that comes with using Apple Pay in person. If there’s one thing your customers will love more than a great product or service, it’s a pain-free online buying experience. The one downside is that Apply Pay will only work online if your customer is shopping on an iOS app or visiting your website on a Safari web browser (which is Apple’s proprietary browser). However, if your customers are using Apple devices, the odds are likely that they’re also using one of those methods to shop online. Check out Apple’s developer resources for more on integrating Apple Pay within your website.
•Tell your customers! – Once you know how Apple Pay works and have it set up in your store or within your website, make sure to promote its availability to your customers so they’ll start using it. Promoting the fact that you offer mobile payment technology like Apple Pay is a great way to reinforce your dedication to a convenient, secure shopping experience. Talk to your customers as they’re checking out and ask if they’d like to complete their transaction with Apple Pay. If they have an Apple device but don’t have the service set up, you can offer resources on how they can learn more about it.
If you’re still uncertain about how Apple Pay works for small business, take some time to talk to your customers about how they prefer to pay. A store upgrade to accept mobile payments could be just the ticket you need to promote your business as a modern brand that’s equipped to keep up with consumer preferences.