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It’s time for independent software vendors (ISVs) and value-added resellers (VARs) to add a SoftPOS solution to their portfolios. Contactless payment transactions have grown significantly. Market.us projects that contactless payments will exceed $10 trillion by 2027, and growth from 2022 to 2026 will top 220 percent. As consumers become more accustomed to using easy tap-and-go payments, they’ll look for the convenience wherever they transact. Furthermore, they’ll gravitate toward retailers, restaurants, and other merchants that accept them. The challenge for those businesses is finding a practical way to accept contactless payments in the aisles, in pop-up shops, and other locations beyond the checkout counter. SoftPOS is an easy-to-implement, cost-effective option.
What is SoftPOS?
Software-based point of sale (SoftPOS), also called tap on phone or tap on mobile, allows merchants to use commercial off-the-shelf (COTS) devices to accept contactless payments without an additional payment terminal or dongle. Merchants contact their payments provider, upload a SoftPOS application onto their mobile devices, and can begin accepting payments almost immediately.
When it’s time to pay, a consumer taps a contactless card or mobile wallet on the mobile device to make a contactless payment. Payment Card Industry (PCI)-compliant SoftPOS handles the transaction while keeping payment data secure.
Which Merchants Benefit from SoftPOS?
Businesses of any size can benefit from SoftPOS, but ISVs and VARs will find that the value this technology offers differs depending on the business model and tier:
- Micromerchants: This solution is perfect for these businesses because it allows them to accept contactless payments, possibly for the first time. No hardware investment is necessary for them to begin to accept contactless card and mobile wallet payments. With a lower barrier to entry for digital payments, ISVs and VARs may see an opportunity to expand into this market by offering SoftPOS along with the other solutions they provide.
- SMBs: Small and medium-sized businesses (SMBs) may already accept contactless payments with near-field communication (NFC)-enabled countertop terminals. But many of them are also looking for a cost-effective way to mobilize employees for in-aisle assistance. SoftPOS can empower any employee with a mobile device to accept payments for line busting, curbside payments, pay-at-the-table, or in the restaurant drive-thru.
- Field Services: Businesses that provide services in a customer’s home or location, from food truck operators to plumbers, can accept contactless payments anywhere with network access. SoftPOS eliminates the need to carry an extra device for payments.
- Large and Enterprise Retailers: Some larger businesses will recognize SoftPOS as a way to ensure operational continuity, providing a secure backup for electronic payments in the event of a network disruption. These retailers can also take SoftPOS to set up pop-up shops or sell outdoors for seasonal items.
Is Offering SoftPOS Right for ISVs and VARs?
Making this disruptive technology available to your customers and prospects represents a significant business opportunity. Grand View Research forecasts the SoftPOS market will grow from $365 million in 2024 to about $1.243 billion by 2030, a 23.1 percent CAGR from 2025 to 2030.
After evaluating your market and their willingness to try SoftPOS, a low-risk way to move forward is partnering with a payments company with a SoftPOS solution. Datacap has a secure, PCI-compliant, SoftPOS solution that is easy to use for you to offer to your customers. You can onboard merchants quickly with this solution and get them accepting contactless payments faster than with a traditional solution. Contact us to learn more about SoftPOS and its potential for business growth.
FAQs
The most recent standard is PCI Mobile Payments on COTS (MPoC), which allows merchants to accept payment data and PINs on the same device. MPoC builds on previous standards, PCI Software-based PIN Entry on COTS (SPoC) and Contactless Payments on COTS (CPoC). MPoC gives developers the flexibility of a modern, objective-based standard that helps to keep data secure while delivering a user-friendly solution.
Yes. You can earn payment residuals on SoftPOS payments. Embedding this option into your solutions can help you build a healthy new revenue stream. Research the terms your payments partner offers.
The SoftPOS provider maintains the software with automatic updates, security patches, and updates related to regulatory and standards changes. With no payments hardware required, this model can significantly lower the total cost of ownership (TOC) for merchants and keep costs low for the ISVs and VARS who provide payment solutions.
