Contactless payments on the anvil for hotels?

Measuring ROI for new technology is not too dissimilar to advertising. The trite old adage about 50% of advertising works with no idea about which 50% may not quite apply to technology but hotels do invest in new technology such as TVs on bathroom mirrors or i-pod docking stations without clear metrics for evaluating their ROI. What is often clear is that customers "demand" such amenities before long resulting in revenue slippage to competitors who do install them. Non-financial metrics frequently accompany the roll out of new technology in hotels.

Contactless payments use RFID (radio frequency identification) that enable customers to make a payment by merely flashing their credit cards near a reader. The transaction is done without a signature or receipt for transactions below $25. Apart from savings in time for both customers and merchants, the technology has benefits such as avoiding physical contact (via the card) that may be of interest to compulsively sanitary individuals.  Yet despite the fact that contactless payments such as Chase bank's Chase "Blink" cards which
have been around for over two years have yet to catch on in hotels. From hostelries having vending machines to resorts with remote outlets stand to benefit from its implementation which over time should catch up with more traditional high ticket sales.

Alnother customer-centric technology that is aong similar lines is the announcement of web-enabled payment systems via smartphones. A new launch is "Square" by a co-founder of Twitter with a device and application geared to enable credit card payments to Apple's iPhones.

eweek reports that "users make a purchase by swiping the credit or debit card
through the reader, which would be plugged into an iPhone that has the Square
payment application on it. The reader parses the card data and converts it into
and audio signal, which is picked up by the phone's microphone and onto the
Square app.The data is encrypted and sent via Wi-Fi or a 3G
connection to Square's servers, which talk with payment networks, including Visa,
Mastercard and American Express. The purchaser signs for the transaction with
their finger on iPhone's touch screen."  While the technology is not similar, the visual is akin to what one encounters at any Apple store with its salespeople walking around with mobile iPhone credit card readers. For resort hotels mobile check-in could be a game changer.

Published by

Vijay Dandapani

Co-founder and president of a New York based hotel company for 24 years. Grew the firm to five hotels in Manhattan and also developed a greenfield project at MacArthur airport, New York. Speaker at numerous prestigious forums including Economy Hotels World Asia, Lodging Conference, NYU, Columbia University Real Estate Roundtable, Baruch College's Zicklin School and ALIS. President and ceo of New York City Hotel Association since January 2017.

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