Tap to Pay on iPhone and Android allows merchants to accept in-person payments directly on their cell phones – eliminating the need for external hardware
The way we pay for goods and services is fast evolving, with innovation driving the industry towards simpler and more flexible solutions. Tap to pay is one such payment innovation widely accepted (and expected) by customers that has grown to be an industry standard. This contactless payment method allows customers to pay for goods or services by simply tapping a credit or debit card against a payment terminal – reducing friction by bypassing the need to input a PIN code for most transactions (as with EMV chip technology) or to swipe a card (as with magstripe technology). Tap to pay as a technology isn’t new – contactless payments have been around for years. What’s groundbreaking is the ability to use mobile phones as payment terminals, eliminating the need for external hardware.
With Apple making Tap to Pay available on iPhones and Google on Android devices, merchants can streamline their operations and reduce costs by centralizing more business processes on their smartphones. This innovation democratizes payment acceptance, making it more accessible for smaller merchants and those selling ad hoc or seasonally to sell in person and accept credit card payments.
Tap to pay benefits
Tap to pay on mobile offers clear benefits for both merchants and for ISOs and Payfacs looking to integrate the capability into their product offering.
For ISOs and Payfacs:
- User experience – Offering a mobile-first solution improves merchant satisfaction and removes barriers to entry.
- Extensibility – Building on Apple/Google’s ecosystem and PSP payment rails enables partners to design custom payments experiences.
- Reach – With lower barriers to entry, more small merchants can adopt Tap to Pay, growing the potential user base for partners.
For merchants:
- Cost savings – No need to invest in external hardware like POS terminals or card readers
- Mobility – Convenience to accept payments anywhere, whether on-the-go or in a retail environment.
- Easy setup – Getting started with Tap to Pay is as easy as downloading the app and activating the feature
Tap to pay also makes it possible for ISOs and payfacs to offer larger merchants an all-in-one electronic cash register (ECR) solution through partnerships with verticalized ISVs. Such integrated solutions enable merchants to leverage ISV software on the merchant-facing display and the Rapyd Pay app on the customer-facing display (a mobile phone with tap to pay). Communication between the two is enabled over the cloud or via app-to-app communication, facilitating the processing of transactions. Eliminating the need for an external payment terminal in this setup delivers a clear cost-savings benefit to merchants.
How it works
Tap to pay is enabled through a short-range wireless communication technology called Near Field Communication (NFC) that allows data exchange between devices or objects that make close contact. This communication allows transaction details to be exchanged between merchants and their customers at checkout. Apple and Google embedded this capability into smartphones so that these can act as payment terminals – replacing the need for specialized hardware.
To complement this, apps listed on Google Play and Apple’s App Store provide the front-end and underlying infrastructure for processing in-person payments through mobile devices. Rapyd supports tap to pay on Android* for its verified merchants. Merchants with compatible devices can get started with tap to pay in a few easy steps:
- Onboard to Rapyd by signing up for a merchant account
- Download the Rapyd Pay app from the Google Play store
- Login with issued Rapyd credentials
- Start accepting contactless payments
ISOs and Payfacs in Rapyd’s partner program can contact their account manager to learn more about how to add on this capability into their partnership agreement. Those new to Rapyd can apply here to join the partnership program.
*Tap to Pay on iPhone will be released in Q1, 25
The Rapyd Pay app
The Rapyd Pay app is the software component that complements mobile phones compatible with tap to pay technology. It is the frontend that, when paired with Rapyd’s behind-the-scenes payments rails, powers the acceptance of in-person payments. The app is easy to set up and use, and has basic payments and reporting capabilities.
How tap to pay on mobile compares to point-of-sale solutions
Tap to pay solutions offer a practical and cost-efficient alternative to point-of-sale solutions for small businesses and micro merchants. Larger businesses with complex inventory and reporting needs, however, may still require traditional and more sophisticated solutions. The following table highlights key differences between the two:
| Tap to pay | Point-of-sale solutions | |
| Hardware requirements | Mobile phone | External payment terminals |
| Associated costs | Transaction fees | Hardware purchase or rental, software, and transaction fees |
| Advanced features | Limited (via apps) | Extensive (vertical specific features) |
| Use case | Best for micro merchants and small businesses | Suited for large scale operations |
| Mobility | High | Limited to terminal location |
| Integration effort | None | Flexible – no-code to full integrations possible |
| Connectivity | Requires internet connection | Can operate offline (depending on provider) |
| Cards supported | NFC-enabled cards or devices only | All card types (NFC, Chip, Magstripe) |
Determining fit for tap to pay
While tap to pay marks a significant step forward in the payments industry, it is unlikely to fully replace hardware systems in the near future. Tap to pay on mobile devices is a fast and convenient way to accept in-person payments, but it isn’t right for all merchants. Here are some key considerations to keep in mind:
- Tap to pay does not support all the software and vertical-specific needs of large or operationally complex retail businesses.
- Tap to pay only supports cards with NFC technology, but not all customers carry or pay with these types of cards.
- Not all devices support tap to pay. Merchants should check with their smartphone manufacturer to confirm compatibility.
Despite these limitations, tap to pay technology signals a shift towards hardware-free commerce. Merchants, ISOs and PayFacs alike are positioned to benefit from adopting the technology.
