Everything You Need To Know About Qr Code Payments

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We are all familiar with the iconic black and white square design of a QR code today. The increased penetration of smartphones and access to high-speed internet has resulted in widespread use of QR codes. That's why we see it almost everywhere, whether it's for shopping, movies, or advertisements.

In this article, we will define QR codes. What are the various types? How does it function? What are its advantages and disadvantages? And everything else you need to know about QR Codes.

So, let's look at what QR codes are.

What is QR code and what’s its history?
The abbreviation QR stands for Quick Response. The QR Code is merely a two-dimensional code. It has a pattern of black squares arranged on a white background on a square grid. QR Codes can be read using imaging devices such as smartphone cameras.

QR Codes are very similar to bar codes, with the exception that they can store more information per unit area.

QR Codes were invented in the 1990s by a Japanese company called Denso Wave. Initially, QR codes were primarily used in the automotive industry for manufacturing, tracking, and ...
... shipping. However, it was gradually adopted outside of the automotive industry for applications such as item identification and marketing.

Many experts believe that QR codes did not take off as expected in their early years. However, in some countries, it was critical to the rapid growth of QR code mobile payment or online payment gateway services because it allowed businesses to accept digital payments without investing in any hardware such as a POS terminal.

How do they work?
One significant distinction between QR codes and barcodes is that QR codes can be scanned from both paper and screen. Linear barcodes, on the other hand, can only be scanned from paper. That is why QR codes can be found on apps as well as online stores.

To scan a QR code, you must have one of the following:
A barcode scanner with the ability to scan QR codes.
A tablet or smartphone with an integrated camera.

Nowadays, there are numerous QR code scanning apps available that allow users to scan QR codes with ease. All the user has to do is open the camera and point it at the QR code; it will immediately recognise it and open a push notification. The user then only needs to tap on it to complete the operation.

There are also some payment and banking apps that can read and process QR codes for bank transfers and payments.
A QR code can be processed in a variety of ways. Some of it is as follows:

Scanning recipient’s QR code with a smartphone
The user must open the phone camera or the relevant QR code scan app during this process. Following that, they must scan the code that appears on an individual product, a paper bill, or at a store's checkout. In the case of a store-specific application, various offers and loyalty points may also be applied via the application.

Retailers scanning QR code on user’s phone screen
Once the total transaction amount is entered into the retailer's POS system, the user launches the payment app. The QR code payment app displays a QR code that corresponds to the user's credit card information. The transaction is then completed when the retailer scans the QR code with a scanner.

App-to-app payments
Both the sender and the recipient open their applications during this process. The sender then scans the one-of-a-kind QR code generated in the recipient's app. Finally, the sender confirms the amount to be paid and taps to complete the transaction.

Types of QR Code
QR codes are classified into two types. Let's go through them one by one.

Static QR code
The URL of the actual destination website is directly placed in the QR code in this type of QR code. The content of these QR codes cannot be changed. These are not trackable; however, they can be fixed by adding the URL.
Static QR codes are used in a variety of industries, including delivery, in-home services, in-store retail, taxi drivers, and street vendors, to facilitate quick and simple payments through the best online payment gateway. In all of this, a user only needs to scan the QR code to make payments without any hassles.

Dynamic QR code
The dynamic QR code can be customised. It also includes features like access management, password protection, scan analysis, and device-based redirection. With dynamic QR codes, you can also learn about the number of people who scanned the code, the type of device they used to scan it, the scanner's location, and so on.

Merchants are increasingly using dynamic QR codes to convey both the purchase amount and the merchant information. Because of this feature, the user only needs to accept the transaction in their application. Furthermore, it implies that the person who sends the QR code has greater control over the payment amount.

In the case of the static QR code, the user had to enter the purchase amount, which was then carefully verified by the merchant. However, by eliminating all of those factors, the dynamic QR code provides a better payment experience for both users and merchants.

Benefits of using QR codes
QR codes have several advantages that can help you reach out to all of your potential customers. Let us look at a few of them.

Instant payments
One of the most significant advantages of using QR codes is that it allows for instant payment. When compared to other modes of payment, paying with QR codes is extremely fast. To process the payment, a user only needs to open the QR code scan app, scan the QR code, and confirm. The payments are made in a matter of seconds.

Top-grade security
Making payments with QR codes is extremely safe. It's because the QR code is nothing more than a tool for exchanging data. Any data transmitted via QR codes is encrypted, making the payment foolproof and secure.

Easy to set up
It is extremely simple to set up QR code payments. You don't require much infrastructure. You only need a smartphone with a camera and a QR code, which can be printed or electronic. The use of QR codes for payments also eliminates the need for a point of sale machine or any other special payment equipment.

Higher reliability
QR code payments are a risk-free payment method because they eliminate the possibility of human error. The pattern of black boxes contains unique data, which increases the trustworthiness of QR code payments.

Major use cases of QR code payments
QR codes provide several businesses with simple payment solutions. Let's take a look at some of the most common QR payment applications.

Fuel retailers
Fuel retailers can also use QR codes to make payment more convenient for their customers. There are fuel retail wallet solutions that allow users to fill up their car by simply entering the amount of fuel they require into the application. These applications include a variety of payment options, including payment via QR code scanning.

E-ticket booking
QR codes are also used in the purchase of electronic tickets. The E-ticket booking application allows users to book bus, flight, train, movie, amusement park, and other tickets with a few clicks on their phone. QR code payment is one of the payment options available in these apps.

Toll payments
Toll booths can also use QR codes to make toll payments more convenient and quick. Toll payment wallet apps enable users to make cashless toll payments. These apps offer a variety of cashless payment options, including QR code payments, RFID and NFC cards.

Parking payments
In a parking payment solution, QR codes can be used as a mode of payment. A parking payment solution enables its user to search for and reserve a parking space via a mobile application. Once the parking space has been reserved, the user can pay by scanning the QR code located at the parking garage.

Street vendors
Street vendors with a limited product offering frequently use QR codes. They simply print a QR code with the product's description and price for all of their products. To buy any product, the user must scan the QR code and confirm the payment.

Micro-business
QR codes are also used for payments by micro-businesses with a limited product offering. The merchant generates both the invoice and the QR code at this point. He then shows the QR code on the smartphone's screen. To complete the transaction, the customer must use their mobile wallet application to scan the merchant's generated QR code.

SMEs (Small and medium-range businesses)
The merchant prints QR codes for each of his vendors, which indicate the location of the cash register and other details. To complete the transaction, the customer must scan the vendor's QR code. The vendor then sends the receipt from the cash register to the customer's smartphone. Finally, the payment is confirmed by the customer.