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QR code payment is an alternative form of mobile payment that requires no card chip or NFC technology: just a camera and an internet connection
Payments with a QR code are increasingly popular among younger consumers and tourists, as well as one of the most demanded forms of payment, especially by Chinese visitors to Spain. Retailers are adopting this payment method as they once did with the bank card and contactless payment. How can QR payment be included in a business?
A QR code (Quick Response code) is a two-dimensional module in image form capable of storing up to 7089 conventional characters (letters, numbers, etc.). Although for people it is a two-dimensional matrix with three squares in three of its corners, for a QR reader it is text stored in the form of zeros and ones. It is a coded message.
QR codes can store all kinds of text. For example, the image in the top left contains the title of this article, the one in the center contains this paragraph, and the one in the right the URL of this blog. Codes can also be used to enter an email, contact details in .VCARD format, postal addresses or passwords for Wi-Fi networks. The more data they contain, the denser they are.
It is even possible to store an entire game of chess. Sometimes they have been used to generate “functional art”. The following QR codes lead to different cultural content, except for one that shows the text “We need you”. You can test it with your phone. If it can be written in text form, then it fits in a QR.
Although there are many types of QR codes (this is an open standard), the most widespread format is the one found in this article: a square frame with three squares in the corners that help the reader to determine the code’s direction. Generally, the content of QR codes is classified into two types:
Very common in Japan and China, countries where they have been paying with a QR code for years, QR code payment is a smart solution for the transmission of information between business and user. For example, it is possible to use a QR code to communicate something as complex as a bank address, a payment protocol or a link that allows you to pay money.
QR code payment is a way to standardize or simplify mobile payments without using the classic card chip or an NFC system.
Currently, there are many options to include QR codes in establishments, many of which are embedded in well-known applications such as WeChat, PayPal, Bizum or AliPay.
WeChat Pay is the first QR payment service to arrive in Spain. It is imported from China, where it has been used as a payment system since 2013. In 2018, the Michelin Guide helped introduce these QR payments in Europe. It is still rarely used in Spain, and its main users are businesses run by Chinese citizens, as well as customers from that country.
By 2020, shortly after the pandemic, PayPal launched a QR payment service for merchants. The mechanics are very simple: the merchant uses PayPal to generate a QR code with a set amount, and the user uses the PayPal app to scan that code and pay from their PayPal account.
As only two phones are necessary (one for the merchant and one for the customer), this is a very interesting solution for mobile points of sale such as markets, booths, fairs, etc. Payment is made by phone, and the receipt is emailed.
At the end of 2021, Bizum announced a functionality for users: payment by Bizum QR, originally designed to pay the Christmas Lottery. Shortly afterward, it launched a complete payment system through the Bizum system, for payment in offices for Loterías y Apuestas del Estado.
These codes have information in text about the Bizum system, the amount, the description, and the phone number that will issue or receive the payment. The QR code is temporary, disappearing within 15 minutes. This is a security mechanism.
It is also possible to generate a QR code through any other online payment system, by entering the URL to the payment platform in a free QR generator such as QR Code Monkey, or requesting the payment system provider to automatically generate QR codes through APIs. This is something relatively simple that, in Spain, is offered by many suppliers of point of sale terminals (POS).
It is also possible to make use of API QR Pay through BBVA. BBVA has developed an integrated solution for merchants through Alipay, the largest mobile and online payment platform. With the QR Pay API, any merchant can integrate a secure payment gateway into any transaction.
More often than not, the QR code of restaurant tables leads to specific web applications from where you can order and pay.
QR payments are fast, flexible and versatile. Generating a QR code is even faster than printing a receipt (where you can actually print the QR), and the payment process only takes a few seconds, for the customer to identify themselves or enter their credentials in their own terminal.
In addition to this speed, QR payment has all the advantages of electronic payments. It is immediate, very safe, you can buy goods and services remotely, create a history, avoid fraud since these are traceable transactions, etc.
On the other hand, one of the biggest criticisms of QR code payment is the lack of security mechanisms for consumers at the time of scanning, unless this is done within an already secure application. A QR code is text, but there’s no way to guess what the user will find when scanning it.
It has long been known that scanning QR codes from generic applications can introduce viruses or unwanted files into the terminal. This is why it is advisable to always use trustworthy banking applications to scan QR codes in stores and businesses such as PayPal QR and Alipay.
Interestingly, QR is a technology that turns 30is 2024, but is just now taking off. At least in Spain. The pandemic made it popular to scan QR menus in restaurants, and contactless payments became equally popular.
QR payment is an alternative way to merge both features, so you do not need to have an NFC phone to make a mobile payment, or a physical credit/debit card. Instead, you “only” need a phone with a functional camera, internet connection and a secure payment app.
Given the trend of use in Japan and then in China, everything seems to indicate that QR payment will have a relevant role in the coming years because of how easy it is to pay.
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