What Contactless Payment Is & How To Use It at your Hair Salon

Contactless Payments

Solutions for You and Your Clients

By Lisa Bakewell

As a small business owner trying to maneuver your way back to active business during COVID-19, you definitely want to get paid quickly and easily, but you also want to get paid as contact free as possible—for client safety as well as your own. While contactless payments have not been as popular in the United States as in other parts of the world, they are becoming more common—and more significant—as we all seek ways to limit the number of surfaces we touch outside the home. As of March 2020, VisaNet shows that 71 percent of face-to-face US transactions occur at contactless-enabled locations, up from 62 percent in March 2019.¹ Now is the time for you and your clients to embrace contactless payment technology. And, fortunately, it is easy to adopt this cleaner, safer way to pay—and to get paid.

What are Contactless Payments?

As a business owner, when you hear the term mobile payment app, you may envision your mobile point-of-sale (POS) app. These POS apps, such as Square, Clover, Vend, etc., are those you install on your phone (or tablet), sync to your card reader, and then process client payments. On the other hand, contactless payments (also referred to as tap-and-go, no-touch, or tap-to-pay) are secure payments made via wireless technology (using a smart card or smartphone and mobile wallet) to pay for products and services without contact of any kind.

Choosing which touch-free payment options to accept can be confusing because there are so many choices. To help, we have compiled all the tap-to-pay info you need to move forward with confidence.

Smart Card Basics

Smart cards, also known as chip cards or EMV cards (named after the creators of this technology: Europay, Mastercard, and Visa), are typical credit/debit cards with an embedded microchip that were created to replace the old magnetic stripe on credit cards for added security. Until recently, clients had to insert their smart card into your POS terminal. But, with the addition of a second chip (signified by vector waves on the credit card), no-touch payments are now possible using a POS terminal with near-field communication (NFC) frequency capabilities.

EMV card, also known as a smart card or chip card, with a vector symbol. 

Mobile Wallet Basics

Smartphones and wearables (such as Apple Watches) mimic smart cards and may also be used to complete no-touch payments. Smartphone mobile wallets allow clients to pay for products and services by holding their smartphone near your reader. Mobile payment methods use the same NFC technology as contactless smart cards, where payment info is collected and transmitted from your POS terminal to your client’s payment processor in an encrypted form. Mobile wallets make it easier and faster to pay, and they are also considered to be more secure.

For your tech-savvy clients, mobile wallets have replaced traditional wallets and store not only payment information but loyalty cards, gift cards, tickets, and even driver’s licenses. There are several mobile wallets, as well as other person-to-person payment apps (like Venmo, Zelle, Cash Up, etc.) that only move money between bank accounts, which we’ll discuss later in this article.

Smart Card and Mobile Wallet Technology

The technology behind contactless payments uses radio frequency identification (RFID) or near-field technology (NFC) to secure a connection between the chip inside a smart card, wearable, or mobile wallet and the POS terminal. When your client makes a contactless purchase, the credit/debit card company requires them to hold their card (or other mobile device) close to a card reader to process the transaction using a one-time token (a unique security code) to help protect against fraud.

Are Contactless Payments Secure?

Contactless payments work by using a unique, one-time token sent from your client’s smart card or mobile wallet to your payment terminal—for each transaction—using the same technology as inserting a smart chip into a card reader (but the process is much faster!). The token does not contain any client credit/debit card details and can only be used one time, so the token prohibits hackers from gaining client payment information. For added protection, most mobile wallets have an additional layer of defense in the form of a PIN, password, or fingerprint your client will enter on their device before their payment can be processed.

Are Contactless Payments Right for My Business?

Consumer behavior is rapidly changing as a result of COVID-19, and clients are increasingly likely to ask if you accept contactless payments. During the first quarter of 2020, Mastercard reported a 40 percent jump in contactless payments—including tap-to-pay and mobile pay—as COVID-19 worsened.2

Accepting contactless payments may seem awkward at first, but soon they will become part of your routine—and will help increase your bottom line. According to Statista, the average mobile spending per consumer exceed $3,647 in 2020 and is expected to almost double by 2023.3

To encourage spending in your physical location, accommodate tech-savvy clients by offering contactless payment options they can use from their smartphones or other mobile devices. For additional online sales, add a “pay with” button to your online store. That way, clients can complete transactions on their mobile devices there as well. Many clients use mobile apps like Venmo, Zelle, PayPal, etc., to send money to family and friends. You can send payment requests directly to your clients for payment using those apps too. Read more about that below.

What to Consider When Choosing Contactless Options

When deciding on contactless payment options, consider the features most important to you for your business. Also, find a contactless app or system you are comfortable with. This will make your transition to no-touch transactions less stressful. To get started, consider all the available POS system (software and hardware) options. There are many out there, so you will be able to mix and match options to suit the needs of your business.


There are many types of POS software—and levels of pricing—to consider when choosing which contactless payment system works best for your business. You’ll want to consider up-front charges, pre-purchase configuration costs (for your specific business), and monthly user fees. These expenses will vary significantly depending on your needs.

  • Mobile POS software. One of the most common kinds of POS software is mobile software, which is optimized for display on cell phones and tablets. Although most apps are easy to use, many lack features like human resource and accounting applications to help run your business. Mobile POS software is generally best suited for small businesses, though, and should cost less than using terminal POS software.
  • Terminal POS software. This software is designed for larger businesses that conduct transactions across multiple POS systems or in several locations. This software also has more bells and whistles than mobile POS software, such as human resource features, inventory tracking, and accounting abilities. You’ll find the terminal POS system to be useful for much more than contactless payments.


POS software needs hardware, and your hardware needs will vary just as much as your software requirements.

  • Smartphones and tablets. It is common for smaller businesses to run their POS systems on a tablet or smartphone. These card-reading devices are easy to attach to your device, come in a variety of price points, and have features that make them ideal for small business owners.
  • POS terminals. POS terminals can simplify the purchasing process for your business transactions and can fluctuate in price and sophistication. Since they can be a bit pricier than using your smartphone or tablet, they are suited to larger, more established businesses with multiple locations.
  • Printers. Though POS systems allow you to email digital receipts, some of your clients will still prefer having a physical receipt.


One of the most important things to consider when searching for a contactless payment POS setup is your budget. Besides the POS system price tag and set-up charges, you’ll also want to consider the monthly fee and per-transaction fees. Make sure to research all of the costs associated with the POS setup you are considering so there are no surprises.


Another consideration are the features you need for a successful and stress-free transition to contactless payments. Also consider how the new system will integrate with your existing POS apps—unless you’re starting from scratch. Finally, assess the customer service and technical support reviews of the companies you are considering. After all, ease of use definitely includes good quality service and support when needed.


Because POS systems vary so widely, there is no one-size-fits-all installation guide. There are a few ground rules, though, that can help you get the most out of your new POS system.

  • Software. Most POS system software is straightforward, but check your system’s website to be sure there are adequate assistance options and tutorials. Also check to see if there are extra fees attached for pre-configuring or modifying your software before shipping.
  • Hardware. To make hardware connection easier, many POS apps and devices are designed to connect via Bluetooth. Keep in mind that you’ll need to place your POS system where it can easily be accessed by you and your clients. If your system features accounting, human resources, or inventory capabilities, make sure you can install it on the relevant hardware (computers, tablets, cell phones, etc.) necessary for synchronicity in your business functions.
  • Service. Again, find a POS provider with excellent customer service and tech support reviews to help ensure you’re getting what you pay for—and that you’re maximizing the overall effectiveness of your system.

Which Contactless Payment Options Should I Offer?

You may have already used a card reader prior to COVID-19, and if your current app accepts contactless payments, you should be ready to go. Just contact your payment provider and tell them to enable the no-touch feature. If you have an older card reader, your payment provider may allow you to swap it for a new one.

If you are new to contactless payments, there are person-to-person apps that don’t require a reader at all, called person-to-person payment apps. If you decide to go with an NFC card reader or terminal, there are several apps you can offer your clients for payment. Prices for NFC terminals range from $300 to $500. If you use your smartphone or tablet to accept payments, you can pick up a reader for $100 or less. Following are descriptions of several popular contactless apps.


  • Cash App by Square allows you to request client payments by sending your request to your client’s cashtag, phone number (via text), or email. There is no reminder option, though, so you will need to send reminders for payment. Cash App charges businesses 2.75 percent per transaction. iOS/Android.
  • Venmo, owned by PayPal, allows you to request person-to-person (P2P) payment from your clients too, but offers a social element that other P2Ps don’t. Venmo's comment and “like” features allow you to interact with clients similar to other social media formats. Venmo charges businesses 2.9 percent of the transaction plus 30 cents. iOS/Android.
  • Zelle is a P2P format that used to be a consumer-only banking service, but it’s recently been opened to small businesses and is available at most banks. Visit www.zellepay.com/get-started to see if your bank is on the list, or you can still use Zelle by downloading the Zelle app. Unlike its competitors, each bank controls how to offer the service and whether (or how much) to charge for the service. iOS/Android.


  • Apple Pay and Apple Cash are considered the best in-store apps because they have all of the popular features of a mobile wallet, and their users are technically super-savvy—and more likely than typical smartphone users to make contactless payments. To accept Apple Pay or Apple Cash, you need a card reader or terminal that reads NFC signals. If you are set up to accept Discover debit contactless transactions, you are set up to take Apple payments as well. If you run into issues with Apple Pay, make sure you are running the proper software on your readers and terminals. Transactions are charged at standard credit card processing rates. Only on iOS.
  • Google Pay has nearly the same core features as Apple Pay and, according to Statista (2020), Android has maintained its position as the leading mobile operating system worldwide (as of December 2019) by controlling the mobile operating system (OS) market with a 74.13 percent share. Together, Google and Apple possess almost 99 percent of the global market share.”4 Google Pay is available on iOS as well as the Android operating system—and uses the same hardware as Apple Pay (an NFC-enabled reader or terminal)—so it would be beneficial for you to accept both. There are currently no fees to use Google Pay. iOS/Android/Google Pay for Windows.
  • Samsung Pay is available only on Samsung phones and uses an exclusive magnetic secure transmission (MST) technology, which allows smartphones to mimic a magnetic strip card swipe to send payment information to card readers that aren’t equipped to read NFC signals. As a business owner, you can save money with Samsung Pay if you don’t already have an NFC reader. If you already have an NFC-enabled reader or terminal, though, you should be able to accept Samsung Pay without upgrades to your current system. There are currently no fees to use Samsung Pay. iOS/Android/Windows.
  • PayPal has an enormous user base (325 million active users worldwide in the first quarter of 2020, representing a 17 percent year-on-year growth5). It offers a fast checkout option called One Touch. If you have an online business, you should take PayPal payments in addition to the other credit cards. Many consumers prefer to use PayPal over other types of payments because of its online security. As a business owner, you can also set up a separate PayPal business account to keep your business and personal accounting separate. There are currently no fees to use PayPal. iOS/Android.

Client Instructions—How to Make Contactless Payments

An image of contactless payments
If you really want to make the most of contactless payments, let your clients know you accept no-touch payments. You can notify clients via email, newsletters, advertisements, or social media. Also, display your readers where clients can see them, and buy stickers or make signs to advertise this new feature. Give clients direction on how to get started.




For Clients: How to set up contactless payment options

  1. Create a mobile wallet by installing a payment app to your smartphone, such as Apple Pay, Google Pay, Samsung Pay, PayPal, etc.
  2. Once your app is activated, your mobile wallet is ready.
  3. Fill your mobile wallet with your credit cards, loyalty cards, gift cards, and even your driver’s license.
  4. Add an additional layer of security by selecting the PIN or fingerprint option in your mobile wallet settings. You’ll use your PIN or fingerprint to authorize each contactless payment.

For Clients: How to make a contactless payment

  1. Unlock your smartphone.
  2. Hold your phone within a few inches of the payment terminal, where you see the payment waves symbol. (Figure XX).
  3. Wait for the beep or check mark.
  4. Your purchase is complete!

You can make contactless payments using:

  • Fitness trackers
  • Key fobs
  • Smartcards
  • Smartphones
  • Smartwatches
  • Wristbands

Square is everywhere.

It became the OG of POS back in 2009 when Jack Dorsey (founder of Twitter) and an artisan glass-blower friend (Jim McKelvey) created a mobile credit card payment method that allowed even the smallest businesses to accept payments anywhere with a smartphone. Square smashed the barrier to entry for credit card payments so dramatically, it turned the whole POS industry on its head.

Square’s chip reader and contactless payment readers can accept payments from most contactless payment apps. It’s still a white square, but bigger, and connects to your smartphone or tablet via Bluetooth. The reader can be mounted to a countertop stand or you can mount it to your iPhone with a special case, although the counter stand is not yet an option for Android devices.

The Square reader for contactless and chip transactions is $49 and the POS software is free. Transaction fees are 2.6 percent of the transaction plus 10 cents.


  1. Visa, “Contactless Payments,” accessed May 11, 2020, https://usa.visa.com/run-your-business/small-business-tools/payment-tech....
  2. Kate Rooney, “Contactless Payments Jump 40 Percent as Shoppers Fear Germs on Cash and Credit Cards, Mastercard Says,” last modified April 29, 2020, accessed May 2020, www.cnbc.com/2020/04/29/mastercard-sees-40percent-jump-in-contactless-pa....
  3. Statista, “Mobile POS Payments,” accessed May 12, 2020, www.statista.com/outlook/331/109/mobile-pos-payments/united-states#marke....
  4. Statista, “Mobile Operating Systems’ Market Share Worldwide from January 2012 to December 2019,” last modified February 28, 2020, accessed May 2020, www.statista.com/statistics/272698/global-market-share-held-by-mobile-op....
  5. Statista, “Number of PayPal’s Total Active User Accounts from 1st Quarter 2010 to 1st Quarter 2020,” last modified May 7, 2020, accessed May 2020, www.statista.com/statistics/218493/paypals-total-active-registered-accou....


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