- Thierry Spanjaard
SoftPOS call for the end of the mPOS
For years, many of us have considered a smartphone had all the needed features to be turned into a POS terminal: it has a large display, a keypad, communication capabilities and an NFC interface to interact with contactless cards. However, it took some time for the SoftPOS concept to come to life. The needed functions were first added on Android based smartphones, they are now coming to Apple's iPhones and iPads.
The path was strewn with obstacles, not only in terms of security but essentially in terms of culture. In the payment world, the basic principle in security is that everything including the card and some aspects of the terminal, should be bolted down tightly, to make sure they remain secure while on the field and not open to intrusions. In the telecom world, security is built thanks to evolution capacity: smartphone firmware and apps receive updates on a permanent basis during their lifetime.
A smartphone is way too complex to be considered secure in our secure transactions environment: it is open to apps downloading, apps could interfere with the virtual keyboard, the display, the NFC interface and the communication to servers.
It has taken years for standardization bodies to come up with specifications allowing to use a smartphone as a payment terminal in a secure way: the PIN on commercial off-the-shelf (COTS) and then Pin on Glass specifications. The next needed move was for handset designers to allow access to their NFC and Secure Element for payment terminals app developers to be able to set up all the needed functions to complete payments.
For a couple years, this was only feasible with Android based handsets, and this has led to offers to use Android smartphones as payment terminals from several vendors: Famoco, DejaMobile, Halo, or MeaPay…
The latest Apple announcement on "Tap to Pay" is that they are finally opening, or at least half-opening, access to their NFC and Secure Element functions in an upcoming version of iOS. One may remember that, in 2020, the Cupertino firm acquired for US$ 100 million (EUR 87 million) Canada-based Mobeewave in 2020, which had developed similar functions on Samsung handsets. For the time being, Apple is presenting these new functionalities as US-only, but one may anticipate they will expand globally.
An iPhone able to receive payments is bound to become a popular solution for all individual entrepreneurs on the move, solo workers, contractors, etc. Of course, what works on iPhones also works on iPads: adding payment functions on an iPad would make it the perfect POS all in one terminal for many small businesses.
Once a smartphone is enough to accept payments, there will clearly be no need for add-ons such as those proposed by Square , Sum Up, iZettle, MyPOS, or a few others…. The mPOS industry will have lived less than a decade!