Since the COVID pandemic, QR code payment methods have skyrocketed in popularity to become a firm favourite for many global consumers, both online and in person. With a quick scan via an app on their mobile phone, shoppers can quickly and securely make a payment without the hassle of having to enter their card details or physically touch a payment terminal.
In this blog post, we explore the origins of the QR code and the rise of QR code payment methods, with a special focus on Zapper, a leading app-based payment method in South Africa.
The evolution of QR codes and payments
Since its inception, QR codes have been associated with convenience as they help users do things quicker. Their origin dates back to 1994 when they were invented in Japan by Masahiro Hara (Toyota Motor Corp.) to assist the automotive industry with tracking motor vehicle parts during the assembly process.
QR codes have since been widely adopted by other industries to simplify a range of processes, including marketing products to consumers. For example, when Apple released its first iPhone in 2007, a QR code was adapted to launch the user’s browser to a URL rather than typing out the full URL, as there were no short codes back then. In this instance, a QR code made it easy for iPhone users to visit a marketing website page to view product information.
It was only a matter of time before QR codes were used to make and receive payments. Both Bitcoin and AliPay launched payment features using QR codes in 2011, followed by WeChat in 2014. It was also in 2014 that Zapper started offering commercial services in South Africa.
The rise of QR code payments in South Africa
In comparison to China where the adoption of QR code payment methods was rapid and quickly accounted for more than 80% of all consumer payments, South Africa had a slow initial uptake largely due to the cost of smartphones and data. Thankfully this barrier has started to disappear due to decreasing costs.
A big driver of QR code payment adoption in South Africa was the COVID pandemic, as users felt more comfortable with contactless payment methods that didn’t require touching a card terminal or a checkout assistant, shop assistant or waiter potentially handling their card. During this time, the market saw massive growth in QR code payments, with Payfast by Network reporting a 412% increase in payments made using a QR code between March 2020 and February 2021.
As with every technology, there are “horses for courses”, and the growth of QR code payments will continue based on acquirers ensuring a simple experience. Its growth is also dependent on it competing against tap-to-pay and cash, two of South Africa’s most popular payment methods. However, it all boils down to convenience and the problem being solved for the customer. In some cases, QR codes may allow customers to skip the queue or avoid the wait for a card machine to arrive or make splitting a bill and adding a tip at a restaurant the easiest way to pay.
How Zapper has become a leading QR code payment method
Zapper was founded in 2013 with commercial services launched the following year. The primary reason why Zapper was established was to bring ecommerce-type metrics and data to brick-and-mortar establishments and allow these merchants to acquire and retain customers more efficiently.
According to Zapper, retailers and small business owners who can’t justify the investment in a custom loyalty and rewards programme, which requires customers to identify themselves with each transaction, are largely flying blind when it comes to their most important asset – their customers. When customers tap-to-pay or use cash, there is very little data relating to that customer that is acquired. In addition, disgruntled customers have no way to tell the business owner that they were unhappy with the service they received. Not to mention loyal customers not being rewarded for their continued support of that establishment.
From the beginning, Zapper set out to offer merchants a way to get to know their customers’ habits – how often they visited, what they were buying and how much they had spent life-to-date. Voucher and Loyalty programmes are also configured with little effort via the Zaper platform, so customers are automatically rewarded for their support and spend.
Zapper’s partnership with Payfast by Network
The beauty of Zapper’s relationship with Payfast by Network is that Payfast merchants can easily enable Zapper as a payment method on their Dashboard. This opens them up to over 15 million users who can pay using the dynamic QR code that’s generated with each transaction.
Zapper has established a vast network of partner apps that can scan-to-pay a Zapper QR code, making it the most widely used QR code payment solution in South Africa. Partners include mobile apps from Absa, Capitec, FNB, Nedbank, TymeBank, VodaPay, MTN Momo, MoreTyme, Payflex and others.
Customers love using Zapper because of its simplicity, convenience and security. Scanning to pay rather than entering sensitive card or bank details at every merchant’s site makes for faster checkout and more transactions. Security of customers’ card data is paramount to Zapper, and all card data is encrypted and stored on the user’s device, not on cloud-based infrastructure (thus cannot be hacked). The only participants in the transaction that have access to the card details are the customer and the banks.
If you have an online store and aren’t offering a QR code payment method, you’re missing out on a vast customer base who are more likely to abandon their shopping cart because they can’t pay with their preferred payment method at checkout. Find out more about the benefits of enabling Zapper as a payment method on your Payfast by Network account here.