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Tap, Spend, Repeat: How Contactless Payments Are Changing the Checkout Game

It’s a digital world; your customers know it, and they hope you know it too! One new solution that people love is the convenience and speed of contactless payment methods. From Apple Pay to tap-to-pay credit cards, contactless payments are becoming the preferred choice for many shoppers. For merchants, this shift presents an opportunity to increase sales and cater to evolving customer preferences.

Let’s dive into what contactless payments are, and why customers spend more when they use them. The key takeaway: businesses need to get on board.

What Are Contactless Payments?

Contactless payments allow customers to complete transactions without physically swiping or inserting their card. Customers simply “tap” their card or mobile device near a card reader equipped with near-field communication (NFC) technology. If you’ve seen what looks like a WiFi signal on a POS terminal, that means it supports NFC payments.

NFC Payment Technology
Source:
iStock

Common examples of contactless payment methods include:

    Mobile Wallets: Apple Pay, Google Pay, and Samsung Pay, where customers use their smartphones or smartwatches to complete transactions.

    Contactless Credit/Debit Cards: Cards with built-in NFC capabilities, recognized by that same wave symbol, allows users to tap their card to pay.

    Wearables: Smartwatches and fitness trackers equipped with NFC payment capabilities allow users to pay with a quick tap.

This frictionless experience is designed to minimize wait times, reduce physical contact, and streamline the checkout process.

The Spending Effect: Why Contactless Payments Lead to Higher Sales

Contactless payments are not only convenient but have also been shown to influence consumer spending behavior. Research shows that customers tend to spend more when using contactless payment methods. A recent analysis found that contactless payment users often feel less friction or psychological discomfort when making purchases, resulting in higher transaction values​.

One reason for this spending tendency is the perception of contactless payments as “quick and painless.” When paying with traditional methods, customers have to physically hand over money or a physical card that they’ve long associated with spending. Contactless payments create a smooth, almost subconscious payment experience that can create the illusion of ‘free’ spending.

According to a 2024 NPR report, transactions made with contactless payment methods are often perceived as more convenient and less restrictive, which can encourage impulse purchases and larger average order values​.

Additionally, mobile wallet users are often encouraged by rewards and incentives linked directly to their digital accounts. For example, Apple Pay users may receive special cashback offers, which can encourage them to spend more frequently using this method. This trend is especially noticeable among Millennials and Gen Z customers, who are both digital natives and strong adopters of new payment technologies.

Why Merchants Need to Adapt

The rise of contactless payments is more than just a passing trend—it’s an expectation for many consumers. Though younger generations have taken the lead, most Americans across age ranges have now made contactless transactions using a mobile wallet or NFC-capable device.

Here’s why merchants should be prepared to support contactless payments:

Higher Sales:

As noted above, studies consistently show that customers using contactless payments are likely to spend more per transaction. For merchants who accommodate contactless payments, this translates to higher sales volume and average order values!

Changing Customer Preferences

Customers today want flexibility and convenience when it comes to payments. Forcing them to use outdated methods can lead to friction and even lost sales. A 2023 survey by PYMNTS.com found that nearly 85% of consumers are paying digitally in some form. This figure is even higher among younger demographics.

Enhanced Safety and Speed:

Contactless payments took off during COVID for obvious reasons. In a time of high anxiety, avoiding contact was the order of the day. This is still a convenience, but it’s also a very secure payment method. Tokenization is built into NFC technology, making it a better option to protect users’ financial data than older payment methods like swiping or cash. 

In a retail landscape where convenience is a major differentiator, offering contactless payments isn’t just an option—it’s a necessity. Merchants who are slow to adapt may find themselves losing ground to competitors that embrace these emerging payment technologies.

Where COCARD Comes In

COCARD adds tremendous value through its product line and dedicated service. However, we only get to add that value if we communicate it!

For the member-owners selling our solutions, the message is simple: contactless payments are the future, and merchants need to upgrade if they don’t already support them. COCARD’s POS systems offer full support for contactless payment methods, among many other payment channels. We provide businesses with the tools and analytics to supercharge their top line.

Seamless Upgrades and Real-Time Updates: As contactless payment technology continues to evolve, COCARD’s POS systems can be easily upgraded to support new features and standards. This flexibility ensures that merchants remain on the cutting edge of payment innovation without the need for costly overhauls.

In-Depth Reporting and Analytics: Understanding customer spending behavior is key to driving sales. COCARD’s POS solutions offer detailed reporting and analytics, allowing merchants to track transactions, identify trends, and enhance their CRM suite. These insights help businesses make informed decisions about promotions, product offerings, and staffing needs.

Conclusion: The Time to Go Contactless Is Now

The rapid adoption of contactless payments is reshaping how consumers transact. For merchants, offering contactless payment options isn’t just about keeping up with technology—it’s about boosting sales, enhancing customer satisfaction, and staying competitive in an ever-changing market.

COCARD’s POS solutions provide the tools to embrace a changing payment landscape, from NFC payments to whatever comes next, ensuring that the future belongs to the merchants we serve.

For our member-owners, the message is clear: Contactless payments are not just a convenience—they’re a major strategic advantage. By equipping merchants with COCARD’s versatile and full-suite POS systems, you can help them attract more customers, increase sales, and navigate the evolving payments landscape with confidence.

Get in touch today to catch up to tomorrow’s payment suite.


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