What is QR code based payment?



I precisely remember the first time when I saw a QR code. I thought that it was just a fancier version of a barcode. Later on, I was pleasantly surprised to see how different and advanced this technology turned out to be.

Today, we all are well familiar with the iconic black and white square design of a QR code. The increased penetration of smartphones and access to high-speed internet has led to the massive adoption of the QR codes. That’s the reason why we see it almost everywhere whether it’s for shopping, movies, ads, etc.


What is a QR Code?
QR Code refers to a quick-response code. It is a trademark name for the 2-dimensional barcode system containing information and is an example of an information matrix barcode. QR codes are often considered similar to barcodes however; a significant difference between the two is that while the barcodes hold information only in the horizontal direction, QR codes can store information vertically as well. Recently QR codes are being used in multiple arenas and the recent trends in the payment system have led to the growth of the use of QR codes.

How do they work?
One major difference between QR codes and barcodes is that the QR codes can be scanned from both paper and screen. On the other hand, linear barcodes can be scanned only from the paper. That’s precisely the reason why you see QR codes both on apps as well as at the online stores.

To scan a QR code, you need to have one of the following things:
  • A barcode reader that has the capability to scan QR codes.
  • Tablet or a smartphone with an inbuilt camera.
Nowadays, there are also many QR code scan apps available that allow users to scan the QR codes with the utmost ease. All the user has to do is open the camera and place it towards the QR code; this will immediately identify it and subsequently open a push notification. The user then just has to tap on it to finish the operation.

There are also some payment and banking apps that can process QR codes for the purpose of bank transfers and payments.

Scanning recipient’s QR code with a smartphone
In this process, the user has to open the phone camera or the relevant QR code scan app. Afterward, they have to scan the code that is displayed on an individual product, paper bill, or at a store’s checkout. Various offers and loyalty points might also be applied via the application in case it’s a store specific application.

Retailers scanning QR code on user’s phone screen
In the QR code payment process, the user opens the payment app once the total transaction amount is set in the POS system of the retailer. The QR code payment app displays a QR code that identifies with the user’s card details. The retailer then scans the QR code with a scanner thus concluding the transaction.

App-to-app payments
In this process, both the sender and the recipient open their applications. The sender then scans the unique QR code that is generated in the recipient’s application. The sender, at last, confirms the amount to be paid and taps to complete the payment.

Benefits of using QR codes:

QR code comes with several benefits that help you to reach out to all your potential customers. Let’s have a look at a few of them.

Instant payments
One of the biggest advantages of using QR codes is that it facilitates instant payment. Making payment via QR codes is extremely quick as compared to other modes of payment. All a user has to do is simply open the QR code scan app, scan the QR code, and confirm to process the payment. Within a few seconds, the payments are made.

Top-grade security
Making payments via QR codes is very secure. It’s because the QR code is nothing but just a tool that is used to exchange information. Any data which is transferred via QR codes is encrypted thus making the payment foolproof secure.

Easy to set up
Setting up QR code payments is extremely easy. You don’t need much of an infrastructure. You only require a smartphone with a camera and a QR code which is either printed or in the electronic form. The usage of QR codes for payments also eliminates the requirement of point of sale machine or any other special equipment used for payments.

Higher reliability
QR code payments are a foolproof payment method as it eliminates the probability of any kind of error. The pattern of black boxes consists of unique data which enhances the reliability of the QR code payments.

Major use cases of QR code payments:
  • Fuel retailers
  • E-ticket booking
  • Toll payments
  • Micro-business

I hope this article helped you to understand several things about QR code.
We provide QR based solution that enables digital payments and can be used across QR enabled apps.
Retail stores: Collect payments faster when dealing with larger audiences to reduce the chaos at the cash counter.
Scan & Pay: Receive payments via QR Code into your bank account.
Your customers can make payments directly from their bank accounts to yours.


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