Functions of Mobile Payment Systems

CIO Review APAC | Friday, June 04, 2021

A mobile payment method is a digital technology that extends the capabilities of traditional payment systems such as credit cards. It is frequently utilized to supplement these payment systems.

FREMONT, CA: Digital payment methods continue advancing with each new technology introduced, and the biggest trend today is mobile pay. The idea of making payments using the phone is particularly appealing to today's connected consumers.

What is Pay Mobile?

Mobile pay, often known as mobile payment systems, is a broad word that refers to purchases made with a mobile phone. A mobile payment method is a digital technology that extends the capabilities of traditional payment systems such as credit cards. It is frequently utilized to supplement these payment systems. Some credit card networks allow users to make card payments without bringing a physical card. Banks enable customers to use cash mobile payments to make purchases by digitally withdrawing funds from their accounts. Mobile payment technology is adaptable, allowing it to be utilized in both peer-to-peer and pay-to-business models.

Peer-to-peer (P2P): People can send money from one phone to another using peer-to-peer technology. For example, one can use mobile pay to share the rent to a friend or use it to purchase a product by sending money directly to the seller. To send peer-to-peer, both the seller and the recipient must have smartphones that are compatible with mobile pay. It is significantly easier to set up because no additional devices or peripherals are required.

Business-to-Business Payment: For a business, the pay-to-business approach allows accepting mobile payments. This is how, for example, one can shop at a store or dine at a restaurant using their mobile phone. One will need a point-of-sale device for this, which is usually an NFC (Near Field Communication)-enabled terminal. Although it necessitates additional equipment and setup, the payment procedure is quicker than the peer-to-peer model.

How Does Mobile Payment Work?

What is the process of making money with a mobile phone? In practice, it is effortless. To make a peer-to-peer payment, all one needs is the recipient's information and the amount they want to send. To make a purchase with pay-to-business, users can use the mobile wallet app to specify the amount required to transfer. Then hold the smartphone close to the terminal (2 inches or less). The payment will be transferred in a matter of seconds, and the transaction will be completed.

NFC technology is used in mobile payments. This is a contactless technique that sends tiny bursts of data rapidly and easily using radio waves. A conversation between the two is started when the cell phone is tapped near the reader terminal. Until the payment procedure is completed, data is transmitted between them utilizing radio waves. All of this happens in the blink of an eye. Compared to EMV chips or magnetic stripes, one of the finest aspects of NFC payments is speed. NFC also encrypts data being transmitted, making mobile payments far more secure than credit cards.

See Also:Top 10 RFID Solution Companies - 2020

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