New Life for QR Codes: Pin Over the Web

In Digital Transactional Processing, Industry Solutions, Insights, Security, Tokenization by Blake McClelland

Remember when QR codes seemed like a cool idea?

 

by Blake McClelland
Director of Business Development

Four or five years ago QR codes started showing up everywhere: on business cards, t-shirts, TV commercials, food packaging and even on busses.How successful were they? This blog pretty much sums it up: “People Taking Pictures of QR Codes

The mistake was thinking QR codes are a good marketing tool. In that context, QR codes add a needless extra step to a simple process. It’s far easier to type a memorable URL or google query into my mobile browser than to download a QR reader, open it, scan a code and then see what comes up (which is probably nothing I didn’t already read on the display ad).

That said, the few times I have bothered using QR codes was in the heydey of Blackberry Messenger when scanning a code was simpler than remembering and typing in a lengthy BBM pin required to add a friend.

The lesson? QR codes are only useful if they make a process simpler.So here’s where I think they’re set to shine in the year ahead: online payments.

Shopping online is God’s greatest gift to people like me who can’t stomach shopping malls on Saturdays. The only part of ecommerce that still annoys me is that moment when I’m checking out and realize I’ve left my wallet outside in the car, which is now under a foot of snow. Half the time the shopping cart times out before I get my details together.

For a while, as an added security measure, many online retailers included ‘3DSecure’, introducing yet another layer of passwords consumers had to get through. The drop-off rate for online purchasing soared. What retailers gained in fraud-prevention, they lost in profits.

For once, QR codes are actually a decent solution.

At checkout, instead of requesting my card number, address, expiry date, CVV etc, a retailer pushes me a scannable code. I grab my phone, scan it with my digital wallet and enter my secure PIN: exactly what I do at a physical point of sale, without ever having to grab my wallet.

Not only does it simplify the process, it introduces a layer of security that’s been missing from online payments: a personalized code, and possibly even biometric data. So a card-not-present transaction is just as secure as a card-present transaction. The results: less drop off and less fraud, meaning lower interchange rates for merchants resulting in lower prices for the consumer.

It makes online purchases highly individualized and therefore highly secure. And it keeps me comfortably on the sofa watching the Colts —exactly where I want to do my weekend shopping.