A Quick Retrofit Adds Cashless Payment To Existing Machines

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This makes for a good reality check: If your vending machines still can't accept anything but bills and coins, you're dramatically limiting your sales today, and the problem will only get worse in the future.

"We don't know what the customer has in his or her pocket," said Alain Huc, vending market director of Ingenico Group. "We need to make it possible for customers to pay any way they want, or else we lose revenue."

Ingenico Group (Euronext: FR0000125346 -- ING), headquartered in Paris, is a global leader in seamless payments for the vending industry. Alain Huc said that when customers have the option to pay with debit cards, credit cards or smartphones, they're likelier to spend more with each transaction. At the same time, mobile payments are getting popular. A recent report from FICO found that 32% of consumers age 18 to 34 were either already using services like Apple Pay and Google Wallet or were very likely to use them in the next 12 months.

Cashless vending can deliver a sales uplift of more than 10%, according to Ingenico Group. Plus, they're convenient. Just one credit card transaction covers as many items as a customer wants to buy. Cashless payments can also reduce the operational costs of handling money and losses related to theft.

Adding cashless payment to vending machines is about more than rewriting existing applications. Even as cost and complexity moves from hardware to software components, it's critical to start with a capable and secure hardware platform. Operators should look for solutions that offer five key features.

1. Flexibility. Payment technologies are changing fast. Solutions should be flexible enough to accommodate future technologies, such as wearable-based payments.

2. Security. Payment solutions must be compliant with all security standards, such as PCI and EMV. Because payment data is very sensitive, it must be highly protected against external attacks.

3. Ease of integration. It should be relatively easy to integrate the payment platform into the operator's vending platform.

4. Remote management. Operators should be able to manage the payment solution remotely, pushing software and firmware updates over the air.

5. Transactions at the edge. To facilitate everything mentioned above, transaction processing must be moved to the vending gateway, rather than exist on the payment terminal.

Ingenico Group's Telium platform features technology based on the Intel Vending Platform, offering the flexibility to accept both traditional and new payment methods, such as bitcoin, Alipay, and closed-loop payment systems. The platform also enables other modern retail practices, like discounts, coupons, and loyalty programs.

When purchasing new vending machines, operators should consider their ability to handle cashless payments, as well as compliance with vending association specifications, including NAMA, EVA and JVMA. However, because the lifetime of a vending machine can extend eight to 15 years, operators should also consider adding cashless payment to existing machines as soon as possible.

Luckily, machines can be retrofitted with cashless payment with relative ease. "Our solution takes between three minutes and five hours to implement, depending on the machine specifications," said Alain Huc. "It can be done in a day."

Alain Huc said that Ingenico Group is continuing to work with manufacturers to improve the integration of its cashless payment solutions into vending machines, as well as with third-party telemetry solutions. To learn more, visit ingenico.com. Register for Intel's hands-on workshop coming up at Venditalia on Friday, May 6, at inteleventexpress.com/venditalia/registration.aspx

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