According to BI Intelligence, Business Insider’s premium research service, the online processing market in the US will count for about $10.7 billion in 2016. With online shopping becoming more popular, this number is expected to reach $17.5 billion in 2020.
Credit Card Processing Methods in the Present
Below you can find the current methods of credit card processing:
Credit Card Swipers or Readers – These small electronic devices allow for reading the account information embedded inside the magnetic stripe of cards. This type of payment processing is usually used to make in-person transactions.
EMV Chip Readers – EMV (Europay, MasterCard, and Visa) standard is designed to increase the security of physical credit card payments. A chip is embedded into customers’ cards to provide additional verification and security.
Mobile Payment Processing – Thanks to mobile POS devices, merchants can leave their brick-and-mortar stores and complete transactions at food trucks, farmer’s markets, sporting events, inside a customer’s home, and more.
Payment Gateway – The first step in the online payment process is associated with payment gateways. They help eCommerce companies accept online transactions, and can be viewed as online versions of payment terminals and front-end processors for online and mobile sellers.
Point-of-sale (POS) Credit Card Processing – Refers to any terminal that customers can use to make a payment via credit cards. This type of credit card processing has to do with traditional retail and countertop card machines.
Virtual Terminals – Are of special importance for small businesses, mail-order telephone merchants, and workers from home. No expensive hardware or software is required for transaction processing.
Credit Card Processing in the Future
The future of credit card processing is associated with speed and efficiency. According to the Huffington Post, 25% of organizations stopped accepting cash in 2015. Given more people are choosing to electronically manage their finances, more companies will stop accepting cash.
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Payment processing is going to be based on mobile payments in the future. Shoppers will prefer Android Pay, Apple Pay, Chase Pay, Kohl’s Pay, Microsoft Wallet, Samsung Pay, Walmart Pay, and more.
According to BI Intelligence, mobile payments will grow slower than expected. However, the volume will account for $503 billion by 2020, which is up $75 billion in 2016. More than half of the US population will try to use a mobile wallet by 2020.