The Best Payment Apps Switching To Contactless Payments
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It is no secret that many people — especially the younger crowd — prefer to skip the cash and pay with a credit or debit card. Some of the more tech-savvy have even ditched physical cards and now store their payment card information in mobile wallets on their smartphones or wearables.
Recently, because of the COVID-19 pandemic, more and more consumers are moving to contactless payments, such as Apple Pay and Google Pay. Because digital wallets are so convenient, most of these consumers probably won’t go back to physical cards even after the pandemic.
As a business owner, you naturally want to accommodate these customers by letting them pay with their choice of technology. However, there are a large number of mobile wallets in the marketplace today. It can be difficult to know which ones are the best pay apps and what you need to do to take mobile payments.
This is why we’ve compiled a list of Best Of options below to help you pick a few of the best payment apps to prioritize. A quick summary table is immediately below but read on for a slightly more detailed look at which mobile payment apps are best suited for different situations.
Learn More About Our Top Picks
| Company | Highlight | Next StepsHighlight |
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Apple Pay  |
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Google Pay  |
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PayPal  |
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Venmo  |
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Square Cash App  |
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Read more below to learn why we chose these options.
Table of Contents [hide][show]
- Why Mobile Payment Apps Matter More Than Ever
- Top 5 Best Payment Apps
- 1. Apple Pay
- 2. Google Pay
- 3. PayPal
- 4. Venmo
- 5. Square Cash App
- What About These Mobile Payment Apps?
- What Businesses Need To Accept Mobile Payment Apps
- The Bottom Line: Payment Apps & Mobile Payments Are Here To Stay
- In Summary: Top 5 Best Payment Apps
Table of Contents
Why Mobile Payment Apps Matter More Than Ever
Even before 2020, mobile payment apps have been gaining acceptance, albeit slowly. (Google had a precursor product in 2011, and Apple started Apple Pay in 2014). The slow acceptance was due to a lack of consumer familiarity and because merchants hadn’t upgraded their hardware and software to take mobile wallet payments.
As businesses have upgraded their hardware, and as consumer hardware makers added more payment paths (e.g., Apple Watch), an increasing number of consumers started to use digital wallets. Still, a segment of the population continued to be reluctant to use mobile payment apps. They worried about payment security, despite the credit card information being protected by layers of passwords and encryption, including credit card tokenization.
Then the COVID-19 pandemic hit, and no one wanted to touch anything unless absolutely necessary. Being able to pay by hovering a phone, a smartwatch, or a credit card over a card reader or take a QR code with the phone’s camera seemed perfect. Online sales and digital wallet use have jumped, and this change is likely to stay.
As a business owner, what was nice to have a couple of years ago has recently become an almost must-have. If you run an online business, a digital wallet can help populate payment information at the checkout and make payments less error-prone. If you run an in-person business, your customer can pay without touching any of the hardware. While customers who want contactless payments might not walk out without buying, they might not buy again at your store because of health concerns.
This is why the ability to take digital wallet payments has grown in importance, especially if you have a business with a physical location.
Top 5 Best Payment Apps
Below are our five picks for the best mobile payment apps. We chose them for their feature-sets, the likelihood that your competitors will accept them, their large user base, and ease of integrating them into your existing payment system.
Some popular apps are conspicuously missing from our list. We’ll explain why later in this article.
1. Apple Pay
Apple Pay |
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Best for paying in-store.
Apple Pay is one of the most full-featured NFC payment apps in the marketplace today, and the service is now available in 55+ countries.
With Apple Pay, users can store their tokenized credit card, debit card, and prepaid card in the app and then make purchases with these cards at a physical store, online, or inside an app. You can also store electronic cash in Apple Cash, where you can load cash from a bank account, credit card, or debit card. You can send or receive the money from this cash account using iMessage or by asking Siri.
The Apple Pay app is password-protected and can be locked through face recognition or fingerprint scan. You can link your Apple Watch to the app and transfer tokenized payment card information to the watch, and later tap the watch to pay for items at a store.
Apple also has its own payment card, the Apple Card, which is a Mastercard that can be used anywhere Mastercard is accepted. This card resides in the wallet and has a physical counterpart for places that can’t take Apple Pay.
Apple users are more likely than other typical smartphone users to use apps to pay with their phones. That is why if you take mobile payments at your store, you are highly likely to see an Apple Pay user who wants to tap an iPhone or Apple Watch to pay. It would, therefore, make sense to get your store ready for Apple Pay.
The list below summarizes Apple Pay.
- Compatible With: iOS devices
- In-Store Payments: Yes
- eCommerce & In-App Payments: Yes
- P2P Payments: Yes
- Debit Card (Digital Or Physical): No
- Noteworthy Features: Send funds via iMessage
- Cost To Merchants: Standard credit card processing rates
- Requirements For Merchants To Accept: NFC-compatible credit card reader/terminal for in-store purchases, developer for eCommerce
2. Google Pay
Google Pay |
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Best for paying in-store.
Just like Apple Pay, Google Pay is a full-featured NFC payment app with a formidable user base. It is available on both Android and iOS.
You can store credit, debit, prepaid/cash, and loyalty cards in Google Pay and use the cards for purchases through a browser, a phone, or inside an app. You can do person-to-person money transfers (or make requests) from the app using a phone number or email. You can even link your PayPal account to Google Pay for an additional layer of convenience. The cloud securely stores your card information. On a device, card tokenization, encryption, and password or biometrics protect your information.
Apple Pay and Google Pay have nearly the same core features. Given that Andriod has a worldwide market share of about 85% to Apple’s roughly 15.5% and given Google Pay is available on iOS as well, the odds of you seeing a Google Pay user is at least as good as seeing an Apple Pay user. Therefore, it would be good to be prepared to take Google Pay at your store as well.
Below is a summary of Google Pay’s major features.
- Compatible With: Android, iOS devices
- In-Store Payments: Yes
- eCommerce & In-App Payments: Yes
- P2P Payments: Yes
- Debit Card (Digital Or Physical): No
- Noteworthy Features: Can link PayPal account
- Cost To Merchants: Standard credit card processing rates
- Requirements For Merchants To Accept: NFC-compatible credit card reader/terminal for in-store purchases; developer for eCommerce
3. PayPal
PayPal |
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Best for paying online.
When it comes to online payments, PayPal is still king. PayPal started in the early days of internet payments, so it was able to sign up a lot of users. This enormous userbase of 361 million active user accounts (at the time of this writing) makes it difficult for merchants who want to take online payments to ignore. (It’s also available for payment processing for physical locations.)
A user can fund a PayPal account by linking a credit card or bank account to PayPal. If the user receives money into the PayPal account, the funds can be kept there indefinitely, transferred out to a bank account, or used through the PayPal Debit Mastercard.
PayPal has a web dashboard and a mobile app compatible with iOS and Android devices. For online purchases, PayPal users can use a fast checkout option called One Touch, which allows for automatic login and auto-fill of billing information. PayPal can also be linked to Google Pay and Samsung Pay to automatically draw from PayPal for purchases made through these third-party wallets.
If you have an online-only business, we recommend that you at least take PayPal Payments in addition to the other credit cards. Many consumers prefer to use PayPal over other types of payments because of online security. You might be missing out on sales if you don’t have PayPal as a payment choice for your shoppers.
Here’s a quick summary of PayPal.
- Compatible With: Web, iOS, Android
- In-Store Payments: Yes (via Google Pay)
- eCommerce & In-App Payments: Yes
- P2P Payments: Yes
- Debit Card (Digital Or Physical): Yes
- Noteworthy Features: Large user base
- Cost To Merchants: 2.9% + $0.30 per transaction
- Requirements For Merchants To Accept: PayPal Business Account; developer for eCommerce/in-app
4. Venmo
Venmo |
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Best for digital purchases.
Venmo is one of the most popular mobile wallets for younger users. The app is known for its social networking element, where you can broadcast your latest purchases to your family and friends for discussion. The app is often used to split a bill among friends or send money to family members. Venmo is owned by PayPal.
A Venmo account is funded by linking it to a bank account or a credit card. When another Venmo user pays you, the money is held in this same account. You can take money out of your Venmo account by transferring it to your bank account or using the Venmo Card, a Mastercard debit card linked to your Venmo account. You can also add this Mastercard to Apple Pay or Google Pay and pay like any other purchase.
There are three ways a user can make direct purchases through Venmo. On some websites (powered by Braintree), a dedicated Pay with Venmo button can be integrated into the checkout. You’ll first have to hit the PayPal button with other sites, which takes you to another screen. If you’re paying through a smartphone, and if the merchant takes Venmo, you will see the Pay with Venmo button to pay directly from your Venmo account.
The third way to pay directly from Venmo is the newest. For now, it’s intended only for single-employee sole proprietorships. The service is called Business Profile, and it’s an account based on your personal account. It’s easy to set up, and after that, you’re assigned a QR code unique to your business. Your customers/clients can scan that code with their phone’s camera and pay directly from their Venmo account to your Venmo business account.
- Compatible With: Web, iOS, Android
- In-Store Payments: Yes (debit card)
- eCommerce & In-App Payments: Yes
- P2P Payments: Yes
- Debit Card (Digital Or Physical): Yes
- Noteworthy Features: Heavy social networking element; Venmo Mastercard debit card is usable by tapping directly on an NFC-enabled reader/terminal
- Cost To Merchants: For eCommerce, 2.9% + $0.30 per transaction through Braintree or PayPal, but custom pricing is available for high-volume merchants; standard Mastercard debit card rates for in-store purchases
- Requirements For Merchants To Accept: Venmo and PayPal or Braintree business accounts; developer for integrating code to web store/app; NFC-enabled reader/terminal for in-store debit charges
5. Square Cash App
Square Cash App |
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Best for requesting payment.
The Cash App is owned by Square. Users can fund the Cash account by linking a bank account (for free) or through a credit or debit card (for a fee). To withdraw money from this account, simply transfer the funds to a bank account or a special debit card called the Cash Card. The Cash Card can be used like any debit card, including making ATM withdrawals, and even be added to Apple Pay or Google Pay.
Users of the Cash App can send money to or request money from other users through a cashtag. The cashtag is a word preceded by the $ symbol, can be used in place of a phone number or email, and uniquely identifies one Cash App user. Users also get a personalized website at www.cash.me/$URL, where they can visit and scan a QR code to send money.
Small service-based businesses can use the Cash App to get paid. A business can request payment by sending the request to the customer’s cashtag, phone number (via text), or email. However, there is no reminder option, so if a customer forgets to pay, the business owner will have to send reminders until they do. The Cash App is fairly popular with the younger crowd. If you operate a one-person business with a younger customer base, the Cash App might be right for you.
Up until recently, the Cash App was the only popular digital wallet that could hold bitcoins. Now, PayPal’s wallet can do the same.
- Compatible With: Web, iOS, Android
- In-Store Payments: Yes (debit card)
- eCommerce & In-App Payments: Yes
- P2P Payments: Yes
- Debit Card (Digital Or Physical): Yes
- Noteworthy Features: Can use Cashtag to send or receive money
- Cost To Merchants: No charge if paid directly through Cash App; standard Mastercard debit card rates if linked through Apple Pay or Google Pay
- Requirements For Merchants To Accept: Square Cash account dedicated to business use; NFC-compatible reader/terminal for in-store purchases through Apple Pay or Google Pay; developer for eCommerce through Apple Pay or Google Pay
Get Started With Square Cash App
What About These Mobile Payment Apps?
Some notable digital wallets are missing from our Best Of list, a few of which are listed below with an explanation of why they didn’t pass muster.
Samsung Pay
Samsung Pay is a digital wallet that shares many similarities with Apple Pay and Google Pay. It didn’t make our Best Of list for a few reasons:
- Samsung Pay is available only on Samsung phones, and Samsung phones all run on the Android OS. Therefore, Samsung Pay’s potential user base can never be larger than Google Pay’s.
- Samsung Pay has a unique feature called “magnetic secure transmission” or MST, which allows users to send their payment information to a non-NFC-capable card reader by mimicking a magnetic card swipe. This technical advantage might become moot soon, however, as more and more merchants upgrade to NFC-capable readers.
The good news is that merchants won’t have to do anything extra to take Samsung Pay. If you have an NFC reader and can already take Apple Pay or Google Pay, then you should be able to take Samsung Pay too.
Walmart Pay
Walmart is the world’s biggest retailer. When the world’s biggest retailer wants to do contactless payments through an app, that app automatically gets a huge user base. For this reason alone, we mention Walmart Pay here.
Walmart only takes Walmart Pay. The app is proprietary, so if you’re a third-party vendor, unless you sell through Walmart’s online store, you can’t take Walmart Pay even if you want to.
Walmart Pay uses QR codes for in-store contactless payments. When a customer is ready to pay, Walmart’s credit card terminal will display a QR code. The customer can then scan the code with the phone’s camera to make the payment.
Zelle
Zelle is a money transfer service owned by several large banks, and it is a competitor to Venmo and the Cash App. Zelle is becoming more popular, but it’s probably not quite as popular with the young-ish crowd as Venmo and Cash App just yet. This is why Zelle didn’t make our Best Of list.
Zelle transfers money from one user’s bank account directly into another user’s bank account using the recipient’s email or cell phone number. It has the following characteristics:
- Almost instantaneous transfer
- Usually free
- Typically accessed through your bank’s app
- Can request to split a bill
- No social networking aspect
- Transfer limits typically higher than other apps
- Some banks allow small businesses to use Zelle to accept payments from customers
What Businesses Need To Accept Mobile Payment Apps
For a business to accept mobile payments — or more broadly, to accept digital wallet payments — you’ll need some specific hardware and software.
Do I Need New Equipment To Take Digital Wallet Payments?
If you operate an online store, taking digital wallet payments often means adding a special button, such as an Apple Pay, Google Pay, or Pay with PayPal button, to the checkout page. While there are platforms (such as Shopify) that makes adding these buttons relatively easy, with other platforms, you’ll need the help of a developer. To learn more about the Shop Pay button, check out What Is Shop Pay & How It Can Bring Your Shop More Sales.
If you operate a physical store, you’ll have to make sure you have the right hardware. Digital wallets such as Apple Pay and Google Pay (and their watches) all work through NFC technology. So you’ll need a reader or terminal that is NFC capable. You probably won’t need to worry about a QR code reader right now because the only major app that uses it for payments is the proprietary and restricted Walmart App.
Theoretically, the above is all you need to accept most digital wallet payments. However, talk to your payment processor to make sure that the proper software is enabled on your credit card machine and that your processor is running the right software in the backend to complete the transaction.
If you don’t think you can afford new hardware at this time, here are some articles that might help you get the funds:
- What Is Equipment Financing?
- 6 Things You Need To Know About Leasing Equipment
- Equipment Loans: What They Are, How They Work, & 5 Ways To Get One For Your Small Business
- The Worst Credit Card Terminal Leasing Companies
- Don’t Fall Into The Trap Of Leasing Credit Card Machines & Terminals: 4 Smart Alternatives For Getting Payment Processing Hardware
How Much Does It Cost To Accept Mobile Payments?
Beyond the new equipment or software coding work, it doesn’t cost anything extra for a merchant to take mobile payments. Your in-person payment counts as a regular card-present payment, and your online payment counts as a regular card-not-present payment. There really is very little reason not to take digital wallet payments.
The Bottom Line: Payment Apps & Mobile Payments Are Here To Stay
It’s not surprising that consumers are using payment apps and mobile wallets more and more. What is surprising is how quickly this can be brought about by unpredictable, external events, such as a pandemic.
While many things will return to normal after the pandemic, most analysts think that online buying or paying with contactless payments are here to stay. As a small business owner, you can take advantage of these changes.
If you own a physical location, you can accommodate these younger, tech-savvy customers by having an NFC-capable card reader so that they can pay through smartphone payment apps or a smartwatch. If you have an online store, you can hire a developer to add a “pay with” button to your store. With yet other wallets — mostly those for sending money to friends and family — you can send payment requests to your customers for payment. If you’re interested in taking mobile payments, check out The Ultimate Guide To Accepting Mobile Payments.
How many types of mobile payment applications have you integrated into your business? Let us know of your experience, good or bad. Have questions? Leave us a comment!
In Summary: Top 5 Best Payment Apps
- Apple Pay:
- Good all-around digital wallet.
- Works through NFC.
- Google Pay:
- Largest potential user base.
- Good all around digital wallet.
- Uses NFC technology.
- PayPal:
- Large online userbase.
- Can link with Google Pay.
- Venmo:
- Popular with Gen Z and Millennials.
- Strong social element.
- Square Cash App:
- Popular with Gen Z and Millennials.
- Can take ACH transfers, such as paycheck and tax refunds.
Hsin-Wei Luang
Contributor
Hsin-Wei is a freelance writer focused on small business and technology writing. Before becoming a writer, she worked as a techie lawyer for many years until she came to her senses. Now, in her spare time, she plays frisbee with her Mini Australian Shepherd dog.
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