Industry insights Read time : 5 minutes

Innovative payment technologies that commuters will love

Social distancing has consumers making payments from their cars -- and wary of cash and using PIN pads. Here’s how you can meet the demand for safe, seamless payments for commuters.

Convenience-seeking consumers tend to follow the path of least resistance. From sunup to sundown, they use self-checkouts, buy online and pick up in the store, use mobile banking apps, and keep “favorites” lists so they can quickly place restaurant orders online. Moreover, they gravitate toward brands and businesses that offer these conveniences. The one disconnected part of many consumers’ day is their commute or time behind the wheel of a car. However, innovative payment technologies are making it possible to keep consumers connected, streamline payment processes, and improve customer experiences when they’re running errands, commuting to work, or traveling.

Software developers integrating their software or apps with innovative payment technologies are providing cutting-edge solutions for consumers on-the-go, such as

In-Car Payment Systems

When customers pull up to a restaurant drive-thru window to pay, they can use cash or hand the cashier a payment card. Alternately, the restaurant may have the ability to extend the PIN pad to the driver, enabling EMV or contactless, tap-and-go payment. Innovative payment technology has the potential to make paying at a drive-thru even simpler, easier and safer. Bluetooth or near-field communication (NFC) technology can, in effect, turn cars into payment devices. As the vehicle passes by the drive-thru window – or a parking lot gate or a gas pump – it can transmit payment data and initiate a text or email notification of payment to the driver.

Whether in a restaurant drive-thru use case or any other curbside purchase or service, in-car payment systems have the potential to move payments to the background of customer experiences, allowing a business to build a strategy that focuses on engagement and building loyalty.

Voice-Directed Payment

Voice assistants have become a staple in many homes, answering questions or managing tasks when consumers ask questions or give verbal commands. Using innovative technology, such as Amazon Echo Auto, expands this functionality to enable drivers to make purchases from their cars. They can order and pay for food before arriving at a restaurant, buy movie tickets, or even initiate a buy online purchase en route to pick it up at the store, or perhaps, a pickup locker.

This technology can help commuters make the most of their time, accomplishing tasks hands-free.

Tap to Phone

People drive to outdoor events such as craft shows, farmer’s markets, yard sales or festivals. Tap to phone technology that turns a smartphone or tablet into an NFC payment terminal. Attendants collecting entry or parking fees and vendors selling merchandise or food can tether their mobile devices to this technology to accept payments, in some cases, while a driver sits behind the wheel of a car.

Consumers making payments in unconventional merchant settings still appreciate the convenience of digital payments – and they may spend more without having to limit purchases based on the cash in their pockets, which is good news for vendors.

Open-Loop Ticketing

Commuters who take trains or busses also want the easiest and safest ways to pay. Open-loop ticketing enables commuters to use bank-issued EMV cards, in some cases contactless-enabled, to pay fares. It’s more secure – EMV technology uses chip cards rather than the mag-stripe, easily counterfeited, closed-loop cards that transit authorities commonly use. Open-loop systems also remove the friction for commuters when they want to buy or reload cards and lower card setup fees.

Contactless open-loop ticketing may also be the spark that U.S. contactless payment adoption needs. When the London Transport System in the UK, commuters discovered how easy, fast and convenient tap-and-go payments are. By 2016, about 1 million London commuters were using contactless payments.

Parking Payment Systems

Technology has made the overall parking experience more convenient for drivers, for example, enabling apps that help you find a parking spot or reserve spots in advance. Drivers may also have the option of paying for parking through an app such as PayByPhone. With this app, drivers enter their locations and the time they need to use the parking spot. It also allows the driver to extend the time by opening the app and adding more time so that they can avoid parking tickets.

Innovative payment technology leveraging Internet of Things (IoT) or Optical Character Recognition (OCR) may make transactions even easier. License plate recognition or NFC chips in cars eliminate the need for any payment to be exchanged and allows the driver to simply drive out of the garage – similar to the Amazon Go experience.

Consumers Are Ready for Innovative Payment Technologies Now

Since the spread of COVID-19, consumers are acutely aware of the risks of touching common surfaces. Contactless payment use, either via contactless cards or mobile wallets, has increased. In fact, NMI data reveals that in April 2020, during the peak of the pandemic, contactless transactions made up 58% of all transactions. Just one year prior, contactless payments made up just 39%. Moreover, some consumers are basing decisions on where to shop or order food on whether contactless payment is available – it’s an expectation in the social distancing era and not offering it may be a deal-breaker.

NMI predicts more merchants will be investigating new paths to sales that don’t require human intervention during payment transactions – while accommodating the consumer on the go. Does the software you offer integrate with the innovative payment technologies that make it possible? If not, we encourage you to give us a call.

NMI Team

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