The collaboration between CRIF and Qvik focuses on developing a diverse array of financial solutions tailored to meet the evolving demands of banking institutions. The main objectives include enhancing data-driven decision making capabilities, improving operational efficiency and significantly boosting customer satisfaction. By leveraging their combined expertise, CRIF and Qvik aim to deliver outstanding value to clients, driving progress and innovation in the financial industry.

The partnership between CRIF and Qvik is driven by a shared goal of revolutionizing the financial services landscape through innovative collaboration. By combining their respective strengths, the companies aim to deliver integrated solutions that address the diverse and shifting needs of financial institutions. This joint effort will enable CRIF and Qvik to provide state-of-the-art and efficient financial services, securing a competitive advantage in the industry.

This collaboration will offer substantial benefits to both clients and end users. Financial institutions will gain access to integrated solutions that improve decision making, streamline operations and enhance customer service. End users can look forward to more personalized and effective banking solutions, better access to credit information and innovative financial products designed to meet their needs. The combined expertise of CRIF and Qvik will ensure the delivery of high-quality,
secure and reliable financial services.

“Partnering with Qvik enables us to pool our expertise and deliver a cutting-edge and efficient banking experience for our clients. This alliance perfectly aligns with our commitment to innovation and providing advanced solutions that drive growth in the financial sector.”

Andrea Martellone, Digital Platform Business Development & Ecosystem Strategy Senior Director, CRIF

“We are thrilled to embark on this commercial collaboration with CRIF, a global leader in digital financial solutions and credit reporting. By integrating CRIF’s advanced digital onboarding and KYC services into Qvik’s expertise in developing digital solutions, we aim to redefine the financial services landscape, offering our clients enhanced security, compliance and a seamless user experience”, stated Lari Tuominen, CEO, Qvik.

“This partnership underscores Qvik’s commitment to leveraging cutting-edge technology to deliver superior digital solutions, ensuring that financial services are not only accessible but also efficient and secure. Together, we are setting new standards for digital banking and financial inclusion.”

Lari Tuominen, CEO, Qvik Group

The post Qvik and CRIF join forces to revolutionize digital banking appeared first on Qvik.

More on payments: 10 ways to optimize your checkout and payment experience in practice

Steps to be included into the PSP tendering process

1. Gathering requirements
   • Business requirements
   • End user needs
   • Finance requirements
   • High level tech & architecture requirements
   • Needs from operations & customer support
2. Gathering current financial data per sales channel, country & payment method
3. Selecting Payment Service Providers who will participate in the process
4. Formalizing the the Tender materials and sending those to vendors
5. Initial material reviews & vendor meetings
6. Evaluating the candidates
7. Negotiations and further rounds with selected vendors
8. Contract negotiations with the selected PSP
9. Next steps include project implementation, etc.

Ingredients for a solid offer

By understanding the typical criteria for evaluating payment service providers, businesses can make informed decisions that align with their specific needs and objectives.

Security and compliance: Security is paramount when it comes to handling financial transactions. A reputable PSP should adhere to the highest standards of security protocols, such as PCI DSS compliance, encryption technologies, and fraud prevention measures. Additionally, they should comply with relevant regulations, such as Payment Services Directive Two (PSD2) in Europe.

Transaction fees and pricing structure: Cost-effectiveness is a significant consideration for businesses, especially for startups and small enterprises. When evaluating PSPs, it’s essential to analyze their fee structures, including transaction fees, monthly subscriptions, setup fees, and any additional charges. A transparent pricing model with no hidden fees provides clarity and helps businesses forecast their expenses more accurately.

Payment methods and geographic coverage: The ideal PSP should offer a wide range of payment methods to cater to diverse customer preferences. Whether it’s credit/debit cards, mobile wallets, bank transfers, or other payment methods like PayPal or Alipay, versatility is key. Moreover, businesses with global ambitions should prioritize PSPs that support transactions in multiple currencies and provide seamless cross-border payment capabilities.

Integration and flexibility: Integration ease with existing systems, such as e-commerce platforms or point-of-sale (POS) systems, is crucial for a smooth payment processing experience. Hence, A PSP with robust APIs, plugins, and SDKs simplifies integration. It also allows for customization according to the business’s specific requirements. Additionally, scalability is vital to accommodate future growth and adapt to evolving market trends.

Customer support and service level agreements (SLAs): In the event of technical issues or disputes, responsive customer support can make all the difference. Evaluate the PSP’s support channels, including phone, email, and live chat, and inquire about their SLAs for issue resolution and downtime. A reliable support team that is available 24/7 ensures peace of mind and minimizes disruptions to business operations.

Reporting and analytics: Access to comprehensive reporting and analytics tools empowers businesses to gain insights into their payment transactions, track performance metrics, and identify opportunities for optimization. Look for PSPs that offer real-time reporting dashboards, transaction reconciliation features, and customizable analytics to facilitate informed decision-making.

Reputation and reliability: Reputation speaks volumes in the world of payment processing. Conduct thorough research on the PSP’s track record, customer reviews, and industry reputation. Service providers with a proven track record of reliability, stability, and financial soundness inspire trust and confidence in their services.

Scalability and future-proofing: As businesses evolve and expand, their payment processing needs will evolve as well. Choose a PSP that can scale alongside your business growth and adapt to emerging technologies and market trends. Assess their roadmap for innovation, partnerships, and upgrades to ensure long-term viability and relevance.

Read more: A turnkey solution for PSP tendering

The right payment service provider is an enabler for your business

When you’re planning to have an optimal payment service, you need to take numerous requirements from your business, customers, markets and offering into account. It’s a good idea to rely on existing experience to have all of this covered. You may do PSP tendering maybe once in five to ten years. We’re involved in these processes on a monthly basis and have ongoing discussion with all the significant PSPs. We will help you to find the best fit payment service provider.

In recent PSP tendering projects we have been able to:

• Support merchant business requirements with a single PSP integration
• Reduce payment processing fees by up to 50% with transparent pricing and cost effective payment methods
• Automate payment processing from checkout to reconciliation end-to-end
• Improve customer experience with vast variety of payment methods and enhanced checkout user experience

The outcome of a successful payment service provider tendering process results in a reliable, cost-effective, secure, and compliant solution that meets the needs of both the organization and its customers. If this sounds like something that you are looking for – check out our turnkey PSP Tendering package.

The post A guide to payment service provider tendering: Process and criteria appeared first on Qvik.

Why is payment optimization important?

Optimizing your payments is one of the easiest and most cost-efficient ways to increase revenue. You don’t need to make hefty changes or improvements to your core product or service; simply ensure that your checkout experience is as frictionless as possible. By picking low hanging fruits and making minimal adjustments, you’ll often gain a great positive impact on your bottom line.

With payment optimization, you’ll also get an improved customer experience. When your customer is at checkout, they’ve already done their research, found a solution, compared alternatives, and chosen your brand. You definitely don’t want to lose them at this point! By improving your payment experience you’ll create happy customers and a lovable brand experience that will continue to contribute to your business’ success.

10 recommended ways to optimize your payments 

1. Monitor transaction trends, especially declines: Keep track of your transaction trends and patterns to identify any anomalies or potential issues. We encourage building a proper dashboard to follow these metrics & defining a practice for regular follow ups and analysis.
   
   
2. Optimize payment gateway settings: Optimize your payment gateway settings to reduce false declines and improve acceptance rates. You’ll also maintain low fraud levels. Based on your product or service, fine tune things like 3DS & AVS settings, velocity rules, Merchant Category Codes, captcha practices, authorization expiration times, automatic retries, and so on.
   
   
3. Offer multiple payment options: Provide customers with a variety of payment methods to accommodate their preferences and reduce the likelihood of declines. Certain payment methods, such as mobile wallets, provide merchants with additional data that can be used in loyalty programs. Others have capabilities to streamline the checkout process with, e.g., one-click payments.
   
   
4. Optimize fraud detection tools: Configure your fraud detection tools and services, provided by payment processors or third-party providers, to identify and prevent fraudulent transactions. Targeting a 0% fraud rate is often not optimal, as it requires rules that are highly defensive. The risk of declining good customers is real.
   
   
5. Update customer payment details automatically & regularly: Use network tokenization or account updater to reduce transaction declines for stored credit cards. Alternatively, prompt customers to update their payment information regularly, but remember that each prompt is a potential friction point.
   
   
6. Monitor disputes & chargebacks: Alike monitoring declined transactions, monitoring disputes and chargebacks is essential for protecting revenue. You want to identify and minimize issues like friendly fraud, pricing errors, duplicate charges, refund or processing delays and overall understand potential quality issues your product or service might have. Chargeback management entails a cost in terms of time and resources you want to minimize. Depending on the amount of chargebacks, automating the management might make sense.
   
   In addition to the items above, focusing on user experience often pays off:
   
   
7. Ensure accurate data entry: Validate input field data programmatically or encourage customers to double-check their payment information. This way you’ll minimize errors, such as typos, in credit card numbers, expiration dates, or billing and shipping addresses. Most payment service providers provide ready-made component libraries and payment pages that reduce your engineering efforts.
   
   
8. Communicate with customers: In case of declined transactions, provide clear and helpful instructions to customers on how to resolve the issue. You can also provide an alternative payment method. Balance between customer experience and potential risk of fraud in your communication.
   
   
9. Mobile optimize: Mobile-optimized checkout experiences aim to minimize friction points. Examples of such friction points could be extensive forms with numerous input fields, slow loading times, and difficult navigation. For most merchants, mobile is a primary sales channel, yet it’s not optimized to the extent that it should be. Optimize for a smooth and user-friendly process, taking into account the customer’s context, device, and limited screen size. This way you’ll achieve higher conversion rates.
   
   
10. Reduce the amount of required checkout steps: Every step in the checkout process poses a risk of losing a potential customer. Therefore be mindful of what customer data you collect and when. As a rule of thumb: only ask for the things you really need and preferably post transaction, if possible. 

By implementing the actions listed above, you can minimize declined transactions, enhance the customer experience, and above all, increase the likelihood of a successful transaction. 

We work with numerous merchants and payment service providers on a daily basis to improve and develop their payment and checkout experiences. We’ve also packaged our decades of experience into an offering that guarantees great results with limited investments.  

Want to optimize your payments? Check out our payment optimization package.

Keen to learn more about failed transactions? Take a look at our nation-wide survey on why Finns abandon their shopping carts at the payment stage.

The post 10 ways to optimize your checkout and payment experience in practice appeared first on Qvik.

The project comes with challenges, including:

• Threats to financial stability
• Hazards regarding loan availability and smaller banks
• Costs for commercial players
• The central bank’s dual role

Possible deposit outflows could destabilize the financial system

Financial system stability refers to its capacity to withstand shock. Banks are central to our current monetary system, and their robust capital and liquidity buffers are the primary reason for their resilience. One of the biggest risks of the digital euro project is that it could negatively impact the amount of money in European commercial banks’ buffers.

A recent study by Copenhagen Economics found that with a holding limit of 3000 digital euros per person, the new currency could lead to an outflow of a whopping 739 billion euros of bank deposits in Europe.

The deposit outflow would lead to hefty losses in banks’ total household deposit base (10%) and total bank liabilities (3%). The effects on highly-impacted institutions, e.g., smaller banks, would be enormous.

The CEO of Finance Finland, Arno Ahosniemi, highlights the possible complications for smaller banks. For them, deposits represent a crucial and cost-effective source of funding. Mass conversion of funds into digital euros could directly limit the ability of smaller banks to issue loans, which negatively influences economic activity.

Limiting holdings to 500 euros per person would confine the loss in deposits to 139 billion. However, it’s important to note that a lower holding limit would highly impact the adoption and usability of the new currency.

The digital euro would entail significant costs to commercial players

The large-scale project would incur significant expenses for the European Union. However, it would also lay heavy costs on commercial banks, payment service providers, and merchants.

The digital euro would present recurring expenditures to private financial market players long after its launch. Although the virtual currency is predicted to eventually decrease consumer prices due to smaller transaction costs, there’s a risk that the cost of implementation would counteract the positive change.

Furthermore, the expenses would primarily fall on banks. Banks would be mandated to distribute and include the currency in their service portfolios. Because of this, the current, carefully curated consumer experiences in banking would be highly affected and need reconstruction. Apps, web services, the processing and recording of transactions, fraud prevention, and Know-Your-Customer procedures, for example, would all be influenced. The costs for banks could significantly affect their innovation resources, leading to decreased quality of service and options for consumers – completely counteracting the EU’s mission of increasing innovation with the new currency.

Overall, the potential for financial losses with each digital euro transaction has raised concerns about the scheme’s sustainability.

The ECB entering the payments market it oversees could be problematic

Lastly, one of the digital euro risks lies in the dual role played by the European Central Bank. Traditionally tasked with overseeing commercial banks, the ECB’s entry into the digital euro space would position it as a direct competitor to these institutions – potentially causing disruption and conflict.

Aura Salla, a member of the coalition in Finland and the former Head of EU Affairs at Meta, has been vocal about the ECB’s confusing role. “The supervisor of credit institutions is looking to mess with the market by building a new payment system. This should be seriously questioned”, says Salla. “I am very concerned about the European Central Bank’s role in the digital euro project.”

Finland’s stance on the digital euro

Salla is part of the Finnish Parliament’s Grand Committee, considering Finland’s stance on the new currency. Salla describes the current Finnish position as “cautiously positive.” Her background adds valuable insight into the conversation, since she has experience from the technology industry’s failed attempts to create a digital currency. Facebook eventually shelved its Libra project due to regulatory challenges.

While Finland acknowledges the potential benefits of the digital euro, the practicalities of seamlessly integrating the currency into the existing financial system remain challenging. “Concrete answers on how the digital euro would function in practice are needed”, Salla concludes.

Salla’s concerns echo a broader conversation surrounding the European Central Bank’s venture. Stakeholders call for risk mitigation safeguards to be included into the scope of the new currency.

Despite critical considerations, Head of Department at the Bank of Finland, Päivi Heikkinen, notes that the central bank can’t afford to ignore the evolving financial landscape and must balance its evaluations with timely introductions of new payment methods.

Is the project too risky?

If well implemented, the digital euro has the potential to offer a secure, regulated, and stable alternative that aligns with the goals of PSD2 while enjoying the trust associated with government-backed currencies.

However, the ECB should test digital euro’s viability against various risk scenarios and periods of stress in the financial system. Risk mitigation will be pivotal in shaping a virtual currency that fosters a stable financial ecosystem.

Read more: Digital euro’s main benefits comprise plunging payment costs and increased security
Read more: Functionality of the new digital euro will focus on effortless consumer use

Are your digital payments optimized?

Are there digital payment methods missing in your service? Or would your business benefit from more revenue by minimizing failed payment transactions? Let’s get to it! Qvik has packaged its decades of payment expertise into a payment optimization packet, which allows you to increase your payment acceptance rates by up to 30% – without a massive, expensive undertaking. Read more.

Qvik is a company that creates lovable consumer products that bring commercial success to our clients. One of our fortes is our constantly evolving expertise in advisory, payments, and monetization. Our services include, e.g., payments and loyalty consulting, business design, authentication advisory, and technology strategy. If you have anything in mind, let’s talk!

Sources

European Central Bank: Financial Stability Review, May 2023
Copenhagen Economics: Effects of a digital euro on financial stability and consumer welfare
The European Banking Federation: Copenhagen Economics study on the impact of a digital euro on financial stability and consumer welfare
Finance Finland: Member of Parliament Aura Salla on the digital euro: Why is the ECB messing with the market by building a new payment system?

The post Digital Euro: Risks include threats to financial stability and costs for commercial players appeared first on Qvik.

The latest developments in the global markets provide a sound backdrop to the initiative. While the only public money in the EU remains cash, private providers have gradually taken over the market with innovative digital payment offerings. In fact, the rising number of convenient and user-friendly payment options has already led consumers to prefer digital payments over cash. 

Private funds have enabled leaps and bounds in payment innovation, but they have their downsides. As a public currency, the digital euro would hold multiple benefits. To ensure that a free-to-use, trustworthy, and accessible currency remains available to all amidst rapid digitalization, many believe that the EU should establish the first global publicly governed digital currency under its central bank.

The most prominent benefits backing the adoption of the digital euro are:

• Increased security for European payments
• Cost reductions
• Regulation and stability
• Accessibility and financial inclusion

Digital euro would increase European payment security

One of the most prominent benefits of the digital euro would be reversing Europe’s current dependence on global players. 

American-based card giants – Visa, Mastercard, and Amex – have long dominated the payment transaction market. The supremacy has become a vulnerability for other nations, especially amidst changes and volatilities in U.S. politics. Global instabilities and wars have further amplified the need for a secure and resilient European alternative to international payment channels. 

A new currency would provide competition and lower transaction fees

According to The Finnish Commerce Federation (Kaupan liitto), the implementation of the digital euro would introduce much-needed competition into the transaction market, eventually leading to lower consumer prices. 

“The prerequisites for the digital currency are good, as the central bank has announced that the new payment method will be free to use”, says Simo Hiilamo, Director of Public Policy and Advocacy for the Finnish Commerce Federation. Offering very low pricing would accelerate business adoption of the digital euro, especially because of the of existing card payment options’ ambiguous and rising prices. “In addition, digital euro service providers, such as banks, have no credit risk when the value of the consumer’s digital euro wallet is on the central bank’s balance sheet.” 

The digital euro’s effect on future payment prices could be significant. The Bank of Finland issued a report stating that in 2020, the commerce sector paid a whopping 121.4 million euros for card payments alone.

“With the recent increases in inflation, the partially percentage-based pricing of card payments has generated credit card companies additional profits. Consumers will eventually have to cover these in the form of ballooning prices,” Hiilamo concludes.

Regulation would strengthen privacy, accessibility, and financial inclusion of digital payments

The digital euro would bring about needed regulation for the virtual currency market. Suggested EU regulation proposes that similarly to cash, the digital euro would have legal tender status inside the EU.

Legal tender status would make digital euro mandatory for individuals, businesses, and institutions to accept as a payment method – making it safe to use and steady in value.

Regulation crafted for the digital euro would also ensure a high level of privacy for its users. The proposed regulation encourages the design of the new currency to minimize the amount of personal data processed by service providers or the central bank itself. Furthermore, the digital euro regulation leans into existing EU policies regarding financial inclusion and accessibility – it enforces accessible design that takes disabilities and limited digital skills into account. 

Finally, digital euro regulation mandates that all credit institutions with account services have to have basic digital euro services available for existing and new clients. For citizens who don’t already have or do not wish to open a digital euro account, the currency must be made available through distribution by public entities.

Will the pros outweigh the cons of the digital euro?

The full impact of a possible digital euro on businesses and consumers in Europe remains to be seen, as it will depend on the extent of adoption, regulatory measures, and the ability of the ecosystem to adapt to the new digital financial landscape.

Despite its potential upsides, the digital euro is currently under critical analysis in several European countries. Read more about the criticisms and risks of the digital euro, or dive into the planned functionality of the digital euro to learn more about what the currency would be like.

Are your digital payments optimized?

Are there digital payment methods missing in your service? Or would your business benefit from more revenue by minimizing failed payment transactions? Let’s get to it! Qvik has packaged its decades of payment expertise into a payment optimization packet, which allows you to increase your payment acceptance rates by up to 30% – without a massive, expensive undertaking. Read more.

Qvik is a company that creates lovable consumer products that bring commercial success to our clients. One of our fortes is our constantly evolving expertise in advisory, payments, and monetization. Our services include, e.g., payments and loyalty consulting, business design, authentication advisory, and technology strategy. If you have anything in mind, let’s talk!

Sources

Finnish Commerce Federation: Digital euro needed to reduce cost of retail payments

The post Digital Euro: Main benefits comprise plunging payment costs and increased security appeared first on Qvik.

While several central banks worldwide have begun exploring the potential of digital capital, the European Central Bank (ECB) has taken a head start. Currently seeking vendors for a digital euro, its goal is to find a trusted roster of operators for frame agreements. Although the central bank has yet to commit to launching any work, the budget allocations shed light on the ins and outs of the upcoming project.

The central bank is looking for partners for:

1. Offline services
2. Risk and fraud management
3. App and software development
4. Alias lookup
5. Payment data security

Offline functionality is at the core of the digital euro

The ECB has reserved the largest bit of the digital euro budget – over half of its 1.1 billion euro allocation – for offline functionality. Although digital currencies are often associated with online use, the ECB promises that all digital euro transactions could be completed without internet access. Offline functionality is prominent for the currency’s usability, supporting the EU’s vision of building a true alternative for cash. 

Furthermore, the ECB’s focus on offline payments reflects an up-to-date understanding of the evolving financial landscape. While digital currencies are gaining ground, there’s a growing need to adapt to changing user preferences, abilities, and circumstances. 

EU-level data would support risk and fraud management

Risk and fraud management has the second-largest focus within the digital euro functionality. The ECB plans to build a central fraud detection and prevention mechanism to help payment service providers (PSP) spot anomalies and patterns.

The central system would be capable of, e.g., scoring transaction risks in real time and producing fraud statistics and intelligence reports. 

The general system would combine data from payment service providers across the EU. However, it would not replace the PSPs’ individual fraud prevention, risk management, and detection rules.

Digital euro app would provide easy access for consumers

The central bank plans to build its own digital euro app. While the application’s primary goal would be to equip consumers with an easy, accessible avenue to digital euros, it would also provide a systematic appearance and user experience for the new currency. For PSPs, the app would provide cost-effective distribution. 

In addition to the app, the EU has allocated funds to create a Software Development Kit (SDK). The planned SDK supports all payment service providers adding digital euro services to their existing consumer channels, including their respective apps and online services.

Aliases ease transactions

Aliases are a familiar concept to any private virtual currency owners. In short, they allow users to make transactions using, e.g., phone numbers or email addresses, thus eliminating the need to remember lengthy account or wallet numbers or knowing the recipient’s bank details. 

The ECB has included aliases in the digital euro scope to enforce acceptance, enhance user-friendliness, and facilitate peer-to-peer transactions. Aliases have many advantages, though – they also reduce fraud risks and require less data. 

Cash-like data privacy

The ECB promises that a digital euro would entail cash-like privacy. The bank has promised that payment information from digital euro transactions could not be used to identify users. In other words, EU regulation for the central-bank-governed digital currency would ensure a new level of privacy compared to other virtual currencies in the market.

The secure exchange of payment information in the new currency is based on tokenization. As we mentioned in our article on digital euro benefits, the EU has outlined that the currency will be designed in a manner that minimizes the amount of personal data processing by service providers or the central bank itself. 

Vendor selection seals the success of the digital euro

The selection of service providers to build the infrastructure for the digital euro is a crucial decision that can significantly impact the initiative’s success and public perception. This is especially true, as the ECB’s has made partner choices that have caused scrutiny in the past.

In 2022, the ECB was criticized by EU lawmakers for selecting the U.S. tech giant Amazon to create an e-commerce prototype for the digital euro. The decision raised concerns about data privacy, security, and the potential influence of non-European entities in developing critical financial infrastructure.

As the ECB embarks on the next phase of developing services around the digital euro, the question of who will be chosen to execute these tasks becomes paramount. The institution must carefully navigate this decision to address past criticisms and ensure that the chosen partners align with the principles and goals of the project.

Read more: Main benefits of the digital euro comprise plunging payment costs and increased security

Read more: Digital euro risks include threats to financial stability and costs for commercial players

Are your digital payments optimized?

Are there digital payment methods missing in your service? Or would your business benefit from more revenue by minimizing failed payment transactions? Let’s get to it! Qvik has packaged its decades of payment expertise into a payment optimization packet, which allows you to increase your payment acceptance rates by up to 30% – without a massive, expensive undertaking. Read more.

Qvik is a company that creates lovable consumer products that bring commercial success to our clients. One of our fortes is our constantly evolving expertise in advisory, payments, and monetization. Our services include, e.g., payments and loyalty consulting, business design, authentication advisory, and technology strategy. If you have anything in mind, let’s talk!

Sources

European Central Bank: What would a digital euro be?
Digital euro: Risk and fraud management component
European Central Bank: Calls for applications for digital euro component providers
Digital euro: App and SDK component
European Central Bank shows it’s serious about enabling digital euro offline use
Digital euro: Secure exchange of information component
Digital euro: Alias lookup component
ECB issues digital euro vendor call for up to €1.1 billion in contracts

The post Digital Euro: Functionality of the new digital cash will focus on effortless consumer use appeared first on Qvik.

Smart point-of-sale (POS) solutions are new-generation sales setups that combine all needed hardware and software into a single device. They also have unlimited access to advanced business applications – explicitly created for different types of ventures. 

Smart solutions rely on an online PIN, which eliminates the need for customers to insert their card into the payment terminal – regardless of the purchase amount. Finland joined other Nordic countries in adopting this system at the start of 2024. As a result, companies that rely on physical payments can now gain a competitive advantage by implementing smart POS in their locations.

Old payment terminals expire in April 2024

Most traditional payment terminals in brick-and-mortar stores are currently version 4 devices (PCI PTS POI v4). These devices are only certified until 30 April 2024, and no new version 4 devices, such as PIN entry devices, unattended payment terminals, or secure card readers, can be purchased after April. Although you can remain using expired terminals, the next-generation devices (version 5.0 or higher) are already advised in case of new deployments or end-of-life device replacements.  

However, there are plenty of reasons apart from updated standards that drive businesses towards updating their point-of-sale solutions. This article clarifies why you should consider shifting to smart devices sooner rather than later. The most prominent reasons include:

1. Cost savings
2. Sales performance
3. Improved customer experience
4. Security standards

Lower the costs of your business with a smart point-of-sale solution

Smart POS solutions offer a future-proof way to create cost savings. Despite the initial investment, you’ll end up both saving money and driving sales with your new devices.

Smart POS allows you to keep tabs on your inventory in real-time. Combining supply data with your sales analytics will enable you to anticipate volumes, eliminate wasteful warehousing costs, and streamline processing. You’ll also be more agile in keeping up with your product information and catalogs. 

As your smart point-of-sale solution is cloud-based, you can rely on any Android device for your transactions and sales management. You can even use your phone. The flexibility eliminates the need for multiple devices with individual purposes.

As your devices age and expire, they won’t eventually be eligible for point-to-point encryption (P2PE). Encryption is still available for expiring terminals, but the newest P2PEs are all created for non-expired devices. Although P2PE is best known for its security features, it’s also a great way to reduce the cost of handling your payments. Point-to-point encryption minimizes the scope of your mandatory compliance, as it separates the customer’s card data from your POS solution and network. This means less documentation, less administrative work, and fewer management hours. 

Point-to-point encryption will completely stop supporting the expiring devices by Spring 2029. Although your devices can still be used in a compliant manner afterward, you’ll lose all the abovementioned scope reductions, and thus your cost savings.

Smart POS also takes care of the remaining compliance requirements on your behalf, meaning you can reduce time spent on audits and keeping up with the changing safety provisions.

In most scenarios, the cost savings created with smart solutions quickly make up for your investment.

Use your smart POS to improve sales performance

Smart POS solutions offer multiple tools for improving your sales performance. 

As smart POS solutions provide real-time data on your sales, they can offer you cross-selling and upselling suggestions. You can utilize these suggestions for optimizing your marketing or, e.g., improving individual sales rep performance. 

A smart solution also helps you optimize your sales strategy by staying on top of product performance, high and low seasons, and trends. A smart POS’s inventory management tools enable automated reordering, meaning you won’t miss out on sales opportunities with out-of-stock products. You can also create and track unlimited reports and key performance indicators with your smart POS to keep you up to speed with your specific business goals. 

Create effortless customer experiences with smart POS

A smart point-of-sale solution should also be considered when trying to elevate your customer experience. With a smart POS, payments are versatile, effortless, and fast. You can accept payments with any Android device anywhere, so whether running a SUP rental, a cupcake pop-up, or a big warehouse sale, you can effortlessly process payments indoors and outdoors. Some examples we have encountered with our clients include seasonal shops, services requiring payment in advance, such as accepting a driving test, and, paying at delivery, such as with courier services. In busy seasons, you can easily add checkouts to your locations with smart POS to minimize waiting time. 

Attaching your loyalty program to your smart point-of-sale solution will provide the most effortless customer journeys. With access to your customer’s online and offline purchase history, you can create targeted offers, personalize the shopping experience, and ensure that the different channels in your customer experience are a seamless match. 

As smart solutions begin to enhance physical locations, they allow you to get closer to the optimized experiences and journeys your brand currently curates online. Furthermore, the modern design of the payment terminal will readily match the overall experience and customer journey you’re trying to create at your location. 

Keep up with the latest security standards

Global payment security is controlled by a universal institution, the Payment Card Industry Security Standards Council. In addition to setting standards and requirements for card payments globally, they provide valuable resources and best practices for companies needing standard-meeting products and solutions. You can take a look at all of their resources here.

The newest versions of smart POS, such as version 6.x of PTS POI devices, are currently the most effective in avoiding attacks by malicious parties. Hackers and other criminal bodies trying to defy cyber security constantly develop new, innovative ways of stealing sensitive customer data during transactions. 

PCI works together with the industries it affects, and because of its collaborative nature, it has already extended its expiration date for the PCI PTS POI v4 payment terminals once – by one year to 30 April 2024. 

With the newest devices, you ensure that your customers’ payment data stays safe.

Qvik is a company that creates lovable consumer products that bring commercial success to our clients. One of our fortes is our constantly evolving expertise in advisory, payments, and monetization. With digital business advisory, you can change your product’s uncertainties to certainties and drive profitability. Our services include, e.g., payments and loyalty consulting, business design, authentication advisory, and technology strategy. If you have any questions, don’t hesitate to get in touch below.

Sources and further reading

Did you enjoy this article? Take a look at our other payment-related resources here.

Sources:

• Suomi liittyy Online PIN -maiden joukkoon
• PCI Security Standards Council
• Protect Payment Data with Industry-driven Security Standards, Training, and Programs
• PCI Security Standards Council Bulletin: Expiry Date Extended for PCI PTS POI v4 Devices
• PCI-validated Point-to-Point Encryption (P2PE) FAQ
• What Are the Ways to Reduce PCI Scope
• The Benefits Of Upgrading To A Smart Point Of Sale Terminal – Virtual Pay
• Implementing smart point-of-sale solutions
• How Retailers Can Boost Sales with a Smart Point of Sale (POS) System | by Syscraft | Medium
• SmartPOS: Reinventing the user experience with an innovative device – Payplug
• P2PE Security Requirements and Testing Procedures

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Only one in ten prefers a fixed-term subscription, and only 15% of Finns prefer to pay for mobile services with one-time payments.

So far, subscription-based business models have been most common in entertainment and educational apps. As most Finns are willing to use a subscription-based payment method but only have one to three active subscriptions, other industries too have a great opportunity to leverage the subscription economy.

Suunto Sports Tracker Premium got a 68% increase in premium users in a few months, and 70% of the new users continued after the free trial

One great example of a well-executed subscription-based application is our client Suunto’s Sports Tracker Premium. Sports Tracker was one of the first mobile sports trackers and has hundreds of thousands of active users each month, with over 700,000 users just in Finland.

Suunto acquired Sports Tracker in 2015. To change the app from a money sink to a viable business, they started building a subscription-based premium model around it in November last year.

The design work for Sports Tracker Premium is done by Qvik’s Minna Nurminen and Oona Lindqvist. In the beginning, the team consisted of Suunto’s product owner Antti Sorvari, Nurminen and Lindqvist, Qvik developers Kate Khudzhamkulova and Joel Pöllänen, and one developer from Vincit.

The work started with surveys and benchmarking and ended with a ROI of over €110,000/month

As Suunto wanted to keep Sports Tracker partially free, the team needed to strike a perfect balance between keeping the app viable and usable for everyone and still giving enough value for premium users so they would pay for it.

The first step was to find out how interested Sports Tracker users would be in certain content and features that the team already knew were popular and possible to deliver.

“Then we asked if the users would be willing to pay for that content, and if so, how much. In addition, we asked background questions to get an understanding of what types of users would be willing to pay”, says Qvik’s product designer Minna Nurminen, who had a crucial role in the concept, validation and design work of Sports Tracker Premium.

Benchmarking and user surveys confirmed the existence of a market and an audience for Sports Tracker Premium.

“Our work in defining user personas and value propositions helped us stay focused on the user’s needs. Together with the survey results and user data, this helped us decide what features to include in the premium subscription.​”

Minna Nurminen, Product Designer from Qvik

As stated in the subheader, this story has a happy ending: users see the value of Sports Tracker Premium, are willing to subscribe, and the premium feature produced €110,000 in revenue to Suunto already in May 2023. Since then, the amount of subscribers has increased steadily and, naturally, so has the revenue.

Get ready to improve acceptance rates with network tokenisation

When we studied the reasons why Finns cancel their subscriptions, we found that almost a fifth (18%) stopped using a service simply because the service period ended and they did not renew the subscription – so they didn’t even actively decide to cancel. 

One way to make it easier for the user to continue a subscription is to use network tokenisation in the payment flow. Google Pay and Apple Pay already rely on network tokenisation, and soon, it will be available for all card payments.

“The health and prosperity of a merchant’s business are closely tied to the authorisation rates of payment cards. When the card authorisation rate is higher, there is an increased probability of repeat customer transactions, leading to higher business revenue”

Sami Nurmi, Payment Specialist from Qvik

With the growing adoption of subscription-based business models, the significance of a secure and seamless payment solution for handling recurring transactions cannot be emphasised enough. Network tokenisation plays a vital role in this, as it substitutes sensitive card information with unique tokens.

These token values safeguard cardholder details and maintain the capability to execute transactions even if the physical card is lost, blocked, or expired. Essentially, this incorporates a card-updater functionality and protects recurring payments.

This article is written based on Qvik’s and Paytrail’s event The subscription revolution: Exploring the future of digital business. Paytrail offers a mobile payment SDK that supports recurring payments through payment card tokenisation. The technical implementation of Paytrail’s mobile payment SDK is done by Qvik’s developers.

Download Qvik Insights report of the most attractive business models for mobile apps and digital services.

Building mobile business on facts

We studied how the Finns want to pay in applications, how willing they are to pay for applications, and what expectations they have for customer service and signing in to applications.

Find out how Finns use digital services.

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If you wish to learn more about how network tokenisation would benefit your business, feel free to contact our advisory team’s Mikko Vahter or Sami Nurmi.

Sami Nurmi

Senior Consultant, Payment Solutions

sami.nurmi@qvik.com

Mikko Vahter

Advisory & Payments

+358408094505mikko.vahter@qvik.com

The post Lessons from Suunto Sports Tracker Premium: How to build the best subscription-based model for your business appeared first on Qvik.

“One of Visa’s primary strategies is tokenization, which involves replacing sensitive payment information with a unique code or token used to complete transactions”, says Thomas Holt Nielsen, Head of Visa’s Risk and Identity, Issuer & Acceptance Solutions in the Nordics and Baltics.

“This ensures that customer data is kept safe from fraudsters while still enabling fast and convenient payments.”

Visa has been leading the charge in network tokenization and digital authentication, and its program and frameworks are in use by companies like MobilePay, Vipps and Mercedes-Benz. While security is the top priority for all merchants, tokenization also opens other possibilities, like maintaining updated payment information when cards expire.

“One of our key initiatives at Visa is Click to Pay. Click to Pay is a global standard for e-commerce and enables secure and convenient consumer payments based on card tokenization – we want it to be as good as contactless face-to-face payments (Tap To Pay)”, Holt Nielsen says.

How to get a digital solution on par with face-to-face transactions?

In today’s digital age, security is a primary concern for all businesses, especially for those operating in the eCommerce space. As more and more transactions are conducted online, the risk of fraud and unauthorized access to sensitive data has become a serious issue.

To combat this, businesses need to implement robust authentication frameworks that can ensure secure access and transactions.

Visa’s Cloud Token Framework is a holistic approach featuring a token that is binded to the consumers device (trusted device) and offers an innovative solution to this problem. It is designed to provide secure authentication for digital transactions by linking the user’s device to their card, including the use of biometrics enabled by FIDO (Fast Identity Online). This means that a user account can only be accessed with a specific device, effectively preventing unauthorized access.

Click to Pay and Cloud Token Framework are game changers when it comes to online shopping with debit or credit cards.

“The combination of Click to Pay and Cloud Token Framework offers unparalleled convenience and ease of use for customers. With the ability to complete transactions with just a single click, Click To Pay makes the checkout process quick and effortless”, says Qvik’s payment expert Sami Nurmi.

“Customers no longer need to waste time filling out long forms or repeatedly entering payment information. With Click to Pay, they can enjoy a streamlined checkout experience, saving them time and effort.”

The Digital Wallet Operator (DWO) or the merchant is responsible for the implementation of the Cloud Token Framework. The DWO is a service provider that manages the user’s digital wallet and facilitates transactions between the user and the merchant. The Cloud Token Framework is an essential component of the DWO’s services, as it provides secure and reliable authentication.

Digital authentication provides liability protection to merchants similarly to 3DS (3D Secure). The Visa Ready Program recognizes this and has adopted the Cloud Token Framework into the program, which identifies and supports innovative payment solutions that meet Visa’s security and usability requirements.

Recap

In conclusion, the Cloud Token Framework is an innovative solution that offers secure authentication for digital transactions. It provides a reliable and convenient way to ensure that only the user’s device can access their account, preventing unauthorized access and reducing the risk of fraud.

As eCommerce evolves, the Cloud Token Framework is set to become an essential component of the digital wallet and merchant app ecosystem, providing a robust security solution for all stakeholders involved. So:

1. Get tokenized
2. Bind the token to the device with Visa Cloud Token Framework
3. Use FIDO for biometrics

This article is based on the event Improving your digital business with advanced CX. The great speakers at the event were Thomas Holt Nielsen from Visa, Teemu Karenius from Yonoton, Juhana Schulman from Terveystalo and Mikko Sievänen from Mint of Finland. The event was hosted at Qvik’s office on March 22, 2023.

The post Make use of Visa’s advanced online card payment solutions and commitment to user experience appeared first on Qvik.

“Consumers should always be vigilant and proactive in protecting their personal and financial information when making online payments. This is not always easy, but awareness is fortunately increasing”, says Qvik’s payment specialist Mikko Vahter.

Safe Pay certification is one way to communicate security to your customers. Its primary focus is on the security of processing the consumer’s data, and the certificate tells customers that it’s safe to pay for their purchase online. This year the certification is granted for Paytrail, Maksuluotto and Walley.

This year we also focused on the user experience of the payment flow

Payment flows are not exactly known for their great user experience. Firstly, the legislation and regulations limit what can be done with payments. On top of that, even if the payment flow is good, the ever-changing field of online payments can be confusing in itself.

The payment market currently suffers from an excess of service providers with different consumer-facing payment brands. Users can feel confused by the sheer number of names and logos alone, making it hard to grasp who is actually in charge of the payment flow.

This year’s Safe Pay audit included a user experience review. We validated whether the user flow supported the chosen payment method’s feeling of security and safety. 

“Secure payment methods do not rule out good user experience”, Vahter says.

“According to Qvik’s observations, most issues are related to accessibility, but luckily these are usually quite easy to fix.”

The accessibility of online payments is crucial for ensuring that everyone can make secure and convenient online payments regardless of ability. Ultimately, this may also lead to increased adoption and use of online payment systems, which can ultimately benefit both businesses and users.

What is Safe Pay?

When you see a Safe Pay certificate and/or the operator is listed on this site, you can be sure that your data will be processed securely and the payment service provider has taken the required measures to prevent fraud.

The Safe Pay certificate primarily focuses on the security of processes, systems and data processing. Certification answers the following questions:

• What information is needed to make a purchase?
• Has the customer undergone strong authentication?
• How can customers change their authentication credentials?
• What is the level of the vendor’s internal data security competence?
• How is customer data processed?

For more information and consultation, don’t hesitate to contact Mikko Vahter.

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