The end of minimum card spend?

We’ve all had that moment in a shop or café where we find out that we have to spend a certain amount before we can pay on card – or worse still, they don’t take cards at all – which often results in us not making the purchase. Conservative estimates suggest that 100m transactions are lost every year because of this problem.

However, this number will start to tumble very quickly and very soon, as mobile payments in all their different guises become increasingly common. It is the ubiquity of smartphones and tablet devices combined with the ease and affordability of mobile payments which is making this change happen. Unlike traditional card acceptance terminals, that not only take a cut of the final transaction but also have to be rented for often-high monthly fees, mobile card acceptance solutions offer a flexibility that traditional terminals cannot match.

The flexibility of the pay-as-you go model offered by the new mobile point-of-sale (mPOS) companies is a major reason why shopkeepers and business owners are looking to mPOS for card payments. Not only does the lack of a fixed-duration contract work out much cheaper, but it is also convenient for seasonal businesses, such as pop-up shops around Christmas.

The small, portable card readers offered by mPOS companies also fit perfectly for businesses on the move. Nobody wants to lug around a card acceptance terminal, while remaining on the look-out for a socket.

Security is obviously an important topic when financial transactions are taking place. The established mPOS companies work closely with financial organisations such as MasterCard and Visa. As a result, they are fully certified by major credit and debit card players. Some mPOS companies are now also FCA approved. The combination of these measures ensures that payments are processed with the highest security standards for card payments.

Such is the success of the mPOS sector, it might edge out players in the established payments industry altogether. It’s not just the manufacturers of card terminals coming under fire, mPOS companies are also tackling the whole point-of-sale set-up, offering merchants the complete package, with cash drawers, till interfaces and receipt printers.

For many small businesses, mobile payments open up an opportunity to expand their customer base and be more in tune with their consumers, ultimately allowing them to grow their business. The widespread availability of smartphones and tablets makes mobile payments the next logical step in a world where financial transactions take up an important part of our daily lives.

Stefan Jeschonnek is co-founder and product lead of SumUp

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