Tap on Phone vs peer-to-peer payments: Which is better for business?

Tap on Phone technology and peer-to-peer (P2P) payments are two different methods of facilitating financial transactions, but they share some similarities in terms of their convenience and accessibility.
Tap on Phone technology refers to a contactless payment method that enables customers to make card payments using a mobile phone as a point-of-sale (POS) device. The merchant’s mobile phone is used as a card reader, allowing customers to tap their card on the phone to make a contactless payment.
P2P payments, on the other hand, are transactions between individuals who use mobile apps or online platforms to send money to each another. These transactions can be initiated from a bank account or a digital wallet.
When comparing Tap on Phone technology with P2P payments, there are some notable differences. Tap on Phone technology is primarily used by merchants to accept payments, while P2P payments are used by individuals to send and receive money.
If you’re running a business, here are 5 reasons why Tap on Phone technology is the best low-cost payment option for your business.
1. No Maximum Transfer
A key difference between the two offerings is the maximum transfer amount. P2P payments are often capped with leading South African providers limiting transactions to R3000. However, with Tap on Phone transactions, there are no limits.
2. Available to Any Bank
Currently, P2P is only available through selected banks, namely FNB, Standard Bank, ABSA and Nedbank. Conversely, Tap on Phone can accept payments using any South African bank card.
3. Customers Don’t Need an App
With P2P payments, both parties need to have registered for the service via their banking app to make a payment. With Tap on Phone technology, the merchant’s app facilitates the transaction using the customer’s bank card, which removes a possible barrier to payment.
4. Process Refunds
Card-based transactions through point-of-sale devices (including tap on phone technology) enable businesses to process refunds which increases professionalism and customer satisfaction.
5. Access to Funding
Providers like iKhokha offer easier access to business funding when compared to traditional bank loans. With iKhokha’s iK Tap on Phone, merchants can start selling with no upfront investment in POS hardware. They can then access working capital after just 3 months of trading.
Find out more about iK Tap on Phone at www.ikhokha.com