What is Softpos? Exploring what softpos is and its potential to revolutionise the payment industry

Imagine a world where every smartphone transforms into a payment terminal, where merchants and their customers trade freely in a cashless, frictionless ecosystem. Welcome to the future of Software Point of Sale (SoftPOS), where boundaries melt away and convenience is king. This technology does not simply streamline payments, it changes the face of commerce, empowering small businesses, and jump-starting economic growth. As we enter a new era of digital transactions, SoftPOS is paving the way, facilitating a secure and inclusive financial future. 

The best technology upends and improves what came before. SoftPOS is one such technology. In the past, it was a challenge to enable fast commerce like pop-up shops, conduct on-the-go payments, and even empower underserved communities. With this future-facing technology, it is now a reality. The payment revolution is here, and it is filled with endless possibilities. 

What is SoftPOS?

 SoftPOS is a transformative technology that turns a smartphone or tablet into a payment terminal. No longer reliant on bulky and expensive card machines, SoftPOS-enabled merchants can accept digital payments anywhere, be it at a pop-up artisanal ice cream stall, or a neighbourhood home business. Customers can tap their cards to pay seamlessly. It's the new age of convenience, efficiency, and innovation, driving the way towards a safe and cashless society. 

 With SoftPOS, the line between the digital and physical worlds blurs. Transacting becomes smoother, faster, and more inclusive than ever before. It's not just technology, it’s financial democracy. Traditional payment methods like Mobile Point of Sale (mPOS),complete with card readers and easy-to-lose dongles have served us well to this point. Now, SoftPOS effortlessly turns smartphones and tablets into secure payment devices. 

History of payments

 The journey of payments stretches back from the ancient barter systems to the modern credit cards we use today. For centuries, currency took the form of tangible commodities such as livestock, food, and precious metals. Coins and paper money followed later. In the 20th century, the landscape of payments saw a seismic shift with the advent of credit cards in the 1950s, heralding the age of cashless transactions.  

These first cashless transactions were facilitated in the same way they are today - via a card reader that served as a mobile point of sale. For decades, it was the only way customers could make cashless payments. The method served us well for the last several decades. Its drawbacks were accepted as part of the landscape - mPOS required a bulky card reader that was expensive to rent and was vulnerable to skimming and tampering.

Contactless payments, including electronic mobile wallets, have been the latest chapter in this ongoing story. The growing need for speed, safety, and simplicity is driving their wide spread adoption. However, as game-changing as they have been, they still left a gap in the market, particularly for small businesses who often found traditional payment terminals costly and cumbersome.

Enter SoftPOS

The leader of the next payments revolution - SoftPOS - has arrived. SoftPOS doesn't just symbolise the evolution of payments; it represents the power of technology to continually adapt, innovate, and level the playing field for businesses of all sizes. We are witnessing software solutions replacing physical things. Who needs a voice recorder or a stopwatch these days when they can be downloaded as apps on a mobile phone? Just like these relics, mPOS will be phased out by a software equivalent - SoftPOS.  

SoftPOS addresses many pain points for various stakeholders in the payment industry. Banks no longer have to manage physical device stock or handle maintenance and replacements. Consumers can transact instantaneously and safely, eliminating the need to carry physical wallets or search for exact change. SoftPOS gives time back to the consumer through queue-busting, payments on delivery, and so much more.

Merchants also benefit because they no longer need to pay upfront fees for devices or expensive monthly rental fees. Best of all, they don't have to wait for hardware delivery before they can start accepting payments. They can easily consolidate their core business application and payment processing onto a single device. Of course, we should mention that mPOS is still the dominant payment form around the world. However, more merchants are moving towards a strategy that combines SoftPOS and traditional payment terminals. 

Security and standards

Security is a top priority. Not every smartphone comes with the same degree of built-in protection, potentially leaving them more susceptible to fraud. As digital payments continue to surge, it becomes increasingly important to encrypt data exchanges between bank cards and smartphones. The aim is to keep cardholder information secure, preventing theft or unauthorised access.

The integrity of SoftPOS transactions is safeguarded by the Payment Card Industry Security Standard Council (PCI SSC). This council unites key players in the payment industry to create security standards and certifications for each solution.Their primary objective is to ensure secure transactions and protect transaction data for both sellers and providers. This is why software-based payment solutions must secure PCI MPoC certification.

How big is the market?

According to a recent report by Juniper Research, the global adoption of SoftPOS solutions by merchants is set to skyrocket to over 34.5 million by 2027, up from six million in 2022. SoftPOS has long been supported on Android platforms, but this new surge can be partly attributed to Apple's recent entry into the space. With the technology giant allowing third-party developers to leverage iOS's near field communication capabilities, it has made mobile POS solutions much more mainstream. This move could potentially open upSoftPOS capabilities to Apple's vast user base of 1.2 billion, tapping into a largely unexplored market.

Additionally, the report suggests that the continued rise of contactless payments will play a significant role in the adoption of SoftPOS solutions. Contactless payment volumes are projected to increase from 195 billion to a staggering 408 billion by 2027. With consumers coming to view contactless payments as the new norm, merchants are feeling the pressure to adopt solutions that accommodate this trend.

As a result, many businesses are opting for SoftPOS systems due to their cost-effectiveness, as they eliminate the need for additional hardware. This increased demand for cashless, convenient payment options is shifting the POS landscape, entrenching SoftPOS as a vital tool for businesses moving forward.

Increasing adoption and the futur 

The mobile phone industry has made leaps and bounds in the area of security, with leading tech giants such as Apple, Google, and Samsung launching contactless mobile payment systems like GooglePay and ApplePay. These platforms allow for the secure storage of virtual credit cards and the emission of payments, bolstering the security of transactions.

Global entities, including international card brands Visa and Mastercard, have also started rolling out their own SoftPOS solutions, aiming at the vast merchant market. This has stirred up competition in the race for market supremacy in the SoftPOS sector.

The market is now brimming with an array of SoftPOS tech providers, of which Halo Dot is an early leader. As we look into the future, it is important to consider how this technology will integrate into the existing payments ecosystem. It is expected that SoftPOSwill serve as a complementary solution alongside traditional payment terminals.

The bottom line

SoftPOS has opened the doors to a world where the convenience of cashless payments is no longer the preserve of big corporations but a reality for every business owner, big or small. Yes, like any innovation, it has its challenges, not least the rocky road to mainstream adoption.  

However, the potential it holds is immense, and the benefits it promises are transformative. As we chart our course into the future, SoftPOS isn't merely an option; it's a key component of a broader digital revolution, propelling us towards a future that's more inclusive, more efficient, and brimming with possibilities.