How Tap-to-Pay Has Evolved—And What Comes Next

Ever since the card industry launched technology that lets merchants process transactions through an off-the-shelf mobile device, companies have worked to refine the idea further. Now, consumers can look forward to making remote purchases with a tap on their phone’s screen when they see something they want, according to payments executives.

“Tap-on-mobile is branching out to other use cases,” said Zakir Hossain, principal product manager at Discover Financial Services Inc. “There would be a small app on your phone. You just tap your card on your own phone, and that’s a card-present transaction, even though you’re tapping your own card on your own phone.” The benefit to the merchant is that the transaction, as a card-present purchase, would be less expensive, said Hossain, who spoke Wednesday at the Southeast Acquirers annual conference in Orlando, Fla., in a session focused on the latest developments in tap-and-pay technology.

And security fears should not hold back the deployment of such technology, the panel said. “There’s nothing faster and safer than tap-to-pay,” noted Albert Comas, chief executive of Yazara Payment Solutions Inc., a New York City-based technology company acquired in September by Global Payments Inc. Comas appeared on the panel with Hossain.

The move to remote consumer-directed payments with the tap of a card on the consumer’s own phone when an item appears that the consumer wants may not become commonplace for some time. But Yazara and Hossain both place the technology in a clear line of development from the earlier emergence of contactless-payment technology, which consumers adopted in a big way during the Covid pandemic. “The trend hasn’t gone down,” since then, said Hossain. “It’s going up.”

The basic technology, known as softPOS, is becoming more and more familiar to consumers and merchants as it has evolved from dongles linked to a merchant mobile device to taps directly on that device. The latest standard, MPOC, was introduced in November 2022 by the PCI Security Standards Council. It defines card transactions using a tap on a “commercial off-the-shelf” device, hence Mobile Payments on COTs. The standard permits PIN entry. “We’re actively promoting MPOC with our merchants,” said Hossain.

Now, the technology is veering toward commonplace deployment. “In some markets, softPOS represents 70% of [our] new merchants,” said Comas, though he cautioned that the technology is not an automatic sell. “It’s not a given. There’s a lot of work to do to educate merchants and consumers that this is just as safe [as a fixed terminal].” Still, in some markets, he said, Yazara is seeing  “hundreds of thousands of new applications” for the technology.

The next stage is the introduction of artificial intelligence agents, the speakers said. “With agentic AI, an agent can do a checkout for you, automating the tasks,” said Hossain. “AI is coming, but it’s very early stage.”