Both NFC & QR Codes Have a Unique Spot in the Mobile Payments Market

With each appealing to a specific niche, Near Field Communication may have a spot in the marketplace just like QR Codes. Previously, it seemed like we had to choose one over the other but time has given each a chance to race for a spot in the market.

Currently, the niches for NFC and QR codes are much distinctive in the U.S. and other economies. The increased liking for contact-free payments and contactless card distribution since COVID-19 has rendered cash a less-liked option, consequently pushing trends toward NFC chips in phones and cards.

NFC is no longer considered an expensive approach and has taken the vanguard as possibly the most ideal, secure, and customer-friendly payment route for the retail point of sale.

But this doesn’t mean QR codes are no longer mainstream. They still hold their spot, especially in global payment avenues where such shopper-friendly solutions are in demand.

Their Pros Vs. Cons

According to Tim Sloane, a Senior Director at Boston-based Mercator Advisory Group, though viewed as more secure, NFC is more complex and expensive to implement. On the flipside, QR codes aren’t as secure as the former, but easier and cheaper to implement.

Nevertheless, both options have managed to deal with their downsides.”If we focus solely on mobile usage, the two solutions are almost at par,” Sloane says. “The challenge is, in the United States, we cannot just ditch plastic cards and switch to mobile. Since the security of NFC hinges on plastic cards, the easy option from a consumer habit standpoint is to proceed with mobile NFC, as it replicates the ‘tap to pay’ method for the regular shopper.”

Still, the QR code remains a staple for closed-loop uses such as loyalty campaigns, e.g., scanning a subscriber card to buy items at a warehouse club.

With that in mind, there are still questions over which is the ideal option — though there’s a lower risk in implementing either strategy.

Final Words

Over time, it has become clear that both avenues have a spot in the mobile payments sector. Instead of choosing one over the other, a better strategy is to implement both QR codes and NFC in the niches where they are most helpful. 

Author Bio: Blair Thomas has been a music producer, bouncer, screenwriter and, for over a decade, has been the proud Co-Founder of eMerchantBroker, the highest-rated high-risk merchant account processor in the country. Blair also understands the payment ecosystem, including check by phone solutions. He’s climbed in the Himalayas, survived a hurricane, and lived on a gold mine in the Yukon. He currently calls Thailand his home with a lifetime collection of his favorite books.