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Smartphone Payments

smartphone payment

Smartphone payments are a modern payment method that allow transactions to be carried out by simply tapping your mobile phone to a reader. Smartphone payment works in a similar way to contactless cards, but with details sent and received via a smartphone.

As with any other form of electronic transaction, a smartphone payment will need a merchant account , and also a PDQ machine that can accept this form of payment. In the same way that credit card payments became popular as a more efficient alternative to cash or cheque, smartphone payments are also becoming more and more popular, with most UK adults having access to the right technology.

If you want to find out more smartphone payment options, and in particular how you can begin to accept them in your business, simply continue reading this page. Otherwise, if you want to start comparing quotes for the right equipment and service now, just fill in the form at the top of the page.

Comparing quotes with Approved Index is free, quick and easy, and it can save your business as much as 40%.

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How Smartphone Payments Work

Mobile payments use a form of interaction called NFC, Near Field Communication, which has been developed from RFID devices. RFID, Radio Frequency Identification, is quite an old technology with limited usage but has enjoyed something of a resurgence in recent years in the form of tracking equipment. Unlike RFID, NFC allows devices a two-way exchange of data, meaning it is suitable for many other tasks. The small amount of power that the NFC chip requires to work is also a technological advantage.

Near field communication requires that the two devices in question, a smartphone with NFC capabilities and the reader, need to be within a few centimetres of each other, in the same way contactless credit cards payments are processed. The smartphone is equipped with an NFC chip, which relays your details to the reader.

You may, on occasion, then be asked to enter your pin number into the reader, much in the same way a card payment works.

Smartphone Payment Security

There are several security measures in place to prevent fraud from occurring in regards to smartphone payments but they do differ depending on the phone itself and its platform.

To access mobile payments you are required to enrol, meaning your details will be added to your mobile payment account. Apple Pay, for example, builds up a profile of the customer’s “Markers” that are then relayed to your bank. Should mobile payments be made in a region that you are not known to live or frequent, this provides the bank with a red marker, blocking its use.

There are many other methods in which each platform will provide security in a variety of ways but it should be noted that, to date, mobile fraud is far less frequent than credit card fraud.

Smartphone Payment Benefits

All forms of payment come with specific advantages and disadvantages and mobile transactions are no different in that respect. As the technology is relatively new, improvements in everything from security to efficiency are occurring regularly.


  • Security
  • Efficiency
  • Convenience
  • Reliability

Despite many of the security fears that surround any new form of transaction technology, smartphone payment fraud is comparatively rare compared to credit cards or contactless payments. While it should be noted that this may become a problem in the future with its likely popularity, all evidence to this point shows it to be a safe method of payment.

Efficiency and convenience are typically at the heart of all advancements in payment technology and smartphone payments are possibly the quickest and most convenient of all.

Although it is a new form of technology to most, many countries, including Japan, Kenya, Taiwan and Hong Kong, have been using it for over a decade. In that time it has grown hugely in popularity, with over 1.8m retailers in Japan alone providing access to phone payment technology.

Smartphone Payment Considerations

The benefits above are well worth considering, but it is also important to bear in mind the factors below:

  • Expense
  • Incompatibility
  • Customer Fears

New, cutting edge equipment tends to be expensive and although prices for NFC readers and usage are dropping, they still remain a significant expense when compared to card readers. In the near to medium future this will likely be less of an issue but at this current time it may only be affordable to a few businesses.

Another issue with new technologies is that they often need others to catch up. Most people in the UK own a smartphone but it is only models in the last few years that have been equipped with NFC chips. Again this should not be an issue in the future but smaller retailers are probably better suited to waiting until such technology becomes the norm.

Despite a raft of security measures in place, and the fact it is a safer way to pay, there is an inherent fear about a payment system that is so easy to use. This can lead to a significant proportion of would-be users avoiding it, at least until the technology becomes universal.

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Smartphone Payment Providers

Some of the major technological giants in the 21st century are providing smartphone payment options, as well as all the major high street banks. These include:

Apple Pay

apple pay

Apple were one of the first providers of mobile payment with the groundbreaking Apple Pay. Apple uses its mobile pay method in conjunction with some of its enormous array of apps to entice customers but with the current vendor fee of 0.15% on each transaction, it can be expensive to implement.

Samsung Pay

samsung pay

Samsung Pay uses MST, Magnetic Strip Technology, which mimics older card technologies and makes it compatible with the devices that most retailers are currently using. Although in the short term this may give Samsung Play a small advantage, as technology moves away from MST, it is likely to become obsolete.



Zapp use digital mobile apps to process payments meaning they do not rely on a mobile wallet in the way most of their competitors do. This may or may not give them an edge as the technology continues to improve but they are predicted to be a real force in the future.

Google Android Pay

smartphone payment

Google has recently introduced Android Pay as their smartphone payment platform, a contactless payment system, which, unlike some of its competitors, is not a single app but a group of 3rd party apps belonging to various outlets.

Compare Smartphone Payment Options

This page contains information about a range of options for businesses looking to take smartphone payments; to get an even better idea of what you can expect though, you just need to fill in the form at the top of this page.

Comparing quotes with Approved Index is free, quick and easy, and it can save you as much as 40%.

Compare Smartphone Payment Options & Merchant Accounts Today.