Nedbank’s tap-on-phone empowers SMMEs with secure contactless payments

At the height of the Covid-19 pandemic, Nedbank became the first bank to offer small, medium and micro enterprises (SMMEs) the ability to turn their cellphones into a payment acceptance device with the launch of its tap-on-phone functionality in October 2020.

Since its successful closed pilot in June, the easily downloadable app has empowered a number of merchants and business owners to accept card payments without having to purchase point-of-sale (POS) devices. Merchants include among others, beauty salons, hairdressers and car washes, proving the importance of the product for small-to-medium-sized enterprises in SA.

“This has really transformed my business because it was fast and efficient in getting set up,” says Lorina Gerber, owner of Pamper & Hair Hub, and one of the first users. "It is also hygienic as my clients don’t have to touch the cellphone and I don’t have to touch their cards. I adopted the system in the middle of August 2020 and my customers already really love it.”

According to a Mastercard study, 75% of South Africans said they are now using contactless payments, citing safety and cleanliness as key drivers, and 78% indicated that they will continue to use contactless post-pandemic.

The innovation is targeted at businesses that aren't geared for digital payments or don't have the capital to quickly invest in new specialised hardware.

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“Tap-on-phone makes it easier for SMMEs to use their compatible smartphones to accept card payments quickly and securely from their customers for goods or services,” says Chipo Mushwana, executive of emerging payments at Nedbank. “Due to the pandemic, we have all been sensitised to the need for social distancing, which has affected all areas of our lives, including how we transact on a day-to-day basis.

“Many of the businesses who leveraged the speed and flexibility of tap-on-phone were able to generate revenue to keep their operations going and, in some cases, get new enterprises off the ground cost-effectively,” says Mushwana. “The functionality builds further on Nedbank’s successful PocketPOS payment solution, which was also the first POS of its kind to be launched in SA in 2013.” 

Mushwana says tap-on-phone is another example of Nedbank’s commitment to harnessing its digital strength, and the power of technology to deliver inclusive banking services. 

“The challenges presented by Covid-19 demand that the world of payments evolves even quicker, and banks must respond by providing innovative ways for businesses to connect with their customers through easy, inclusive and preferably contactless payments solutions,” says Mushwana. 

The functionality uses the same strong security as physical payment terminals and meets Mastercard and Visa requirements. All a user needs is an Android device on version 7.0 or newer that’s NFC-enabled. This makes the functionality valuable for SMMEs and informal traders that were previously unable to accept debit and credit card payments.

Tap-on-phone is a collaborative partnership between Nedbank, Mastercard, Synthesis and iVeri. 

This article was paid for by Nedbank.