CNP Expo: Payments Has Its Head in the Clouds

May 22, 2013

Talk of cloud computing is everywhere these days. But what is the cloud? And how is cloud computing changing the way retailers accept payment?

In an afternoon panel at the CNP Expo, Rónán Gallagher, head of payments at Alpha Payments Cloud, pointed out that “the cloud itself is not so much a revolution as an evolution.” The cloud is a conduit that will enable more—and more innovative—options that will revolutionize payments. These include mobile wallet options as well as more flexible POS software and hardware.

Lee Jurgens of Ralph Lauren explained that for the retail world, this is a huge cost savings benefit. By separating the software and hardware of POS, you can tailor a system for your store that is more flexible and cheaper to evolve going forward, he said. The possibility of mobile POS devices (smart phones, iPads) could ultimately transform the physical layout of retail stores and change the way customers shop. Plus, Gallagher suggested, “a more flexible POS interface can offer new ways to build relationships with customers. It could be something as simple as, if a customer swipes a foreign card, the rest of the transaction takes place in their native language. That’s a better customer experience.”

One obstacle to a cloud-based payment system will be adoption, both by customers and merchants. Dave Kaminsky of Mercator Advisory Group noted that at this point, “cloud-based payment solutions offer the most potential for quick adoption in mobile payments.” He cites the success of the Starbucks mobile payment app as one example that’s already up and running successfully.

And even hesitant merchants will see the security benefit of the cloud. Jurgens explained that the cloud can enhance data security by taking local servers out of stores and allow data from transactions to travel directly to one location, without having to pass through multiple points. “The fewer points you have data pass through,” he said, “the more secure you can make the system.”