Tell me about QR Codes?

What is a QR Code?

A QR (quick response) code is a two-dimensional square code that can store a large amount of information, reliably, confidentially and with strong security. Bar codes carry much less information.

QR codes first appeared several years ago in Japan and were largely used to direct someone to a website to save having to enter a url. In 2018, Apple added a QR scanner into the iPhone camera software with iOS 11. Until then mobile phones required an app to scan a QR code which deterred the use of QR codes. In addition, there was no perceived significant benefit in simply having fast direct access to a web site.

Now every iPhone owner who has kept their software up to date can scan a QR code and make a payment without requiring an app. More recently, Android phones also have an inbuilt QR code scanner. Those that do not are taken through a two-step process to scan.

QR Codes – A software only solution

QR codes have unique and innovative features that make them particularly suitable for contactless payments via mobile. Unlike NFC technology, QR codes do not require any contact to transfer information. So long as the QR code is large enough and clear enough to be read by a mobile phone camera there are no limitations to how far away someone can stand to scan the QR code.

The Yay QR code software solution removes the need for a hardware terminal. This has three key benefits:

  • A merchant avoids the cost of having to rent or buy a terminal.
  • The absence of a terminal removes an element of payment friction experienced when a terminal breaks or Bluetooth connection fails. The full transaction is handled by the merchant’s smartphone or tablet. 
  • Customers never have to touch a public keypad.
  • There is no ceiling limit to a transaction value with Yay!

QR Code Mobile Payments:

Each QR code is linked to a unique web page which carries payment details including merchant branding, product information, price payment options and any other information relevant to the transaction. The payment page content is controlled and populated by the merchant.  

There is no limit to the number of unique QR codes that can be created and they can be generated instantly by the merchant. When contactless payments are made with QR codes you can also digitise payments through any type of print advertising including billboard, poster, newspaper and magazine advertisements; also product packaging, shop windows, vehicle ads, computer screen and television promotions. 

The Yay! mobile payment solution payment page includes a link to ApplePay, GooglePay, Samsung Pay or enables the payee to pay by entering credit or debit card details.  

QR Codes v ‘Contactless’ (NFC / RFID):

A major reason why QR codes were adopted so readily as the payment method of choice in China rather than ‘contactless’ (or NFC / RFID) was that no hardware is required with QR codes. You simply scan the code and pay, unlike with ‘contactless’ where the merchant requires a hardware terminal with an online connection.

The UK is one of the most established ‘contactless’ markets in the world and the sector is becoming more competitive as new players enter the market and offer increasingly lower priced hardware and payment processing rates. The leading ‘contactless’ terminal providers in the UK include iZettle (owned by PayPal), PaymentSense, SumUp, all of whom are primarily targeting existing WorldPay customers.

In an age when people almost always have their phone with them, being able to pay with a phone rather than taking out a card is more convenient, hence the growing adoption of ApplePay and GooglePay. In addition, ‘contactless’ payments have a limit of £45 whereas ApplePay and GooglePay have no limit.

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