Johannesburg, 10 May 2019
The global payments industry is undergoing a quiet revolution as it shifts from traditional non-authenticated transactions, like EFT payments, to new types of solutions that require some form of customer authentication on a transaction before funds are released.
While this is galvanising changes in the industry, suggests Johan Fourie, regional manager for NuPay, more exciting still for the African market, with its large unbanked population, is the shift towards the use of mobile point-of-sale (mPOS) devices. These devices offer an increased opportunity for financial inclusion in SA by opening up the market to those who could not gain access to such services in the past.
"Prior to the advent of mPOS, earlier devices were traditionally speedpoints that were tied to the networks via cables. With mPOS, however, retailers are no longer tied to a specific location or area. Instead, they can utilise what is little more than a pocket-sized device that connects to your smartphone via Bluetooth and uses it to piggyback onto the network," says Fourie.
"While the security controls are the same as with a traditional device, mPOS has been designed to deliver the convenience of on-the-go, coupled with the strongest possible security measures. Moreover, with mPOS devices, the retailer can purchase it and become the owner of the device, instead of merely renting it."
Essentially, explains Fourie, it opens up the point-of-sale arena to even very small businesses, the kind that traditionally would be cash-only operations. It means, he continues, that even if you only operate a flea market stall on weekends, you can still deliver the convenience of card facilities to your customers.
"The beauty of this solution is that it is driven by the software, but because it is all cloud-based, you do not need to have any significant technology built into the device. It is simply a connection to the cloud, and all the relevant information is then pushed back and forth through this connection instead.
"Obviously, the user would need a smartphone, even an entry level one, through which to download the required application. Furthermore, because it is driven via the phone, the user should experience no real hardware issues. With the traditional terminals, most of the technology is built into the device, so if it is dropped, for example, it can easily be damaged. mPOS, on the other hand, is hardy and tough and can simply be slipped into your pocket and transported where it is needed," he says.
In addition, continues Fourie, the mPOS device charges just like a cellphone does, so in the flea market example from earlier, the user could recharge it if required via their car charger. Of course, the main benefit mPOS offers is that it affords small businesses the opportunity to market their wares to the type of higher-end customer who doesn't usually carry cash with them.
"Furthermore, as we look ahead, we expect to see a number of supporting factors being added to these devices. For example, an inventory solution will allow the user to have a real-time inventory list on the device, allowing them to control, manage and clearly understand exactly what they have in stock," adds Fourie.
"I believe that these devices offer enormous potential to SA in terms of the government's drive to position small businesses as key to our economic recovery. By affording these players the opportunity to service cashless customers, and by helping to bring more of the unbanked segment into the financial services orbit, it can clearly help drive small business success.
"Moreover, as the inventory solution we are working on demonstrates, we will also quite likely see, in the near future, new opportunities for, and ways of, using this device arising that have not even been thought of yet," he concludes.