• Brad Hyett, CEO at phos


• 03.12.2024 02:45 pm
#SoftPoS #FutureOfPayments

As we approach 2025, software point of sale (SoftPoS) technology, with its ability to turn any NFC-enabled device into a contactless payment terminal, stands poised to redefine how businesses accept payments. With projected transaction values skyrocketing, the financial sector must confront a critical question: can legacy systems keep up with this unprecedented shift?

While SoftPoS offers immense potential for efficiency and growth, it also risks deepening the divide between tech-savvy firms and those clinging to outdated models. Are we witnessing the dawn of a new era in payments, or are we setting the stage for a backlash against rapid technological change?

Novel PayTech: Growth or Disruptor?

As business leaders understand SoftPoS better and major financial institutions become accepting of it, this payment technology will grow exponentially. In emerging markets, it will be instrumental in facilitating the rise of contactless payments. However, there is no denying that the innovation is a significant departure from traditional payment acceptance methods like pin-and-chip machines. 

The shift is likely to cause friction between early adopters and traditionalists, especially as the gap between them widens. In such times, it is important to remember that consumers favour purchases with minimal friction and novel technologies like SoftPoS make it possible to meet this demand in a timely and cost-effective manner. 

MPOC Certification: Catalyst or Barrier?

Mobile Point of Sale Contactless (MPOC) certification is a standard developed by the Payment Card Industry Security Standards Council (PCI SSC) and other regulatory bodies to ensure the secure handling of payment data when using mobile devices for contactless transactions. As it becomes the industry standard, it will provide larger organisations with the clarity they need to incorporate newer payment methods like SoftPoS into their businesses. 

MPOC will go a long way in standardising compliance across regions. However, the change in regulations might also cause some temporary uncertainty and make firms sceptical of the technology. To manage this, SoftPoS providers should make an active effort to answer any questions and resolve merchants’ doubts. Educating them about the benefits of the regulation will also go a long way. Once the initial apprehension passes, the standard will help boost merchants’ confidence in novel payment technologies and make them more open to modernisation.  

Emerging Markets: Latecomers or Pioneers?

Contactless payments are on the rise in emerging markets. As a result, merchants are actively looking for affordable payment technology which will make it easier for them to cope with changing consumer behaviour and preferences. 

The ability to rapidly expand payment acceptance points without having to bear the costs associated with traditional payment technology makes SoftPoS a very lucrative product for firms in these markets. Their positive attitude towards innovative solutions acts as a catalyst for the widespread adoption of the technology and positions emerging markets as a key source of growth in 2025. 

SoftPoS: Just PayTech or More?

The bundling of SoftPoS with other business tools will become a lot more sophisticated in 2025. Since the technology can embed payment acceptance within a firm’s existing distribution channel, it will only become a more lucrative tool for merchants’ tool stacks. There is potential to use SoftPoS for inventory management, customer loyalty programs, and other essential tools, which creates a holistic and efficient operational ecosystem for companies.

The goal would be to eventually create a network of interconnected tools, which will be able to supplement, analyse, and develop insights from consumer data - and SoftPoS is the perfect starting point for this. 

Therefore, while SoftPoS might appear to be a means to widen the technological gap between companies, it is definitely a step in the right direction. It offers avenues for innovation and growth for technological adapters and legacy firms alike in a cost-effective manner. Regulatory clarity will make it easier to adopt this technology and in the coming year, businesses should grab the opportunity to transform their ecosystem with both hands.