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Take On Payments, a blog sponsored by the Retail Payments Risk Forum of the Federal Reserve Bank of Atlanta, is intended to foster dialogue on emerging risks in retail payment systems and enhance collaborative efforts to improve risk detection and mitigation. We encourage your active participation in Take on Payments and look forward to collaborating with you.

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May 21, 2018


Heading toward A New Era of POS Portability?

At recent conferences I've attended, exhibitors in the point-of-sale (POS) terminal and acquiring business were all showing off their portable devices. With one of these, a restaurant server could take a payment at the table or a retail employee could conduct a transaction in a store aisle. The exhibitors said that these devices allow for a more high-touch, personalized customer experience than traditional counter-top POS devices. In fact, while walking the exhibit floor, I noted that countertop POS devices were extremely hard to find.

The theme of POS portability was also evident in the session rooms. Multiple panel discussions and keynote speeches focused on the Payment Card Industry's (PCI) PIN-on-glass security standard, which would give already-in-the-marketplace devices for using mobile phones and tablets as card readers the ability to use PIN-based authentication. In essence, the standard allows customers to enter their PINs on merchants' commercial off-the-shelf (COTS) devices—such as bring-your-own-device tablets or phones—rather than on PCI-certified devices that a merchant owns or leases through its acquiring relationship. PIN on glass has been widely implemented in Australia and, based on what I've heard at these conferences, it is probably one to three years from making any headway here in the United States.

I first wrote about portable POS devices in the restaurant industry nearly six years ago. Since then, I can count on my hands the number of times I've swiped or dipped my card at a portable POS terminal (and several of these interactions occurred in Mexico). Most experiences were positive. On numerous occasions, I've used my card with a COTS device, also with mostly positive experiences. I have honestly never envisioned using or yearned to use a PIN for these transactions.

Little has changed in the way of mobile POS adoption since I wrote that post. So, do I believe we are moving towards a new era of POS mobility? Yes, but very slowly. With the proliferation of independent software providers and their mobile-based solutions for payment processing, I think the industry is now better positioned than it was six years ago for a change. However, I learned from speaking with others in the industry that the conversion process remains time consuming and costly. As far as PIN on glass goes, will the consumer be an obstacle to adoption? I'm not convinced that consumers will be comfortable entering their PIN on someone else's mobile device.

What is your take on the future of POS portability?

Photo of Douglas King By Douglas A. King, payments risk expert in the Retail Payments Risk Forum at the Atlanta Fed

May 21, 2018 in biometrics , card networks , cards , debit cards , emerging payments , mobile payments | Permalink

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