Tribe Payments Exposes Costly Gaps in Legacy POS Tech – 1 in 4 Merchants Miss Out on Alternative
By Dominic Sow · 14 November 2024
A new study from Tribe Payments, the pioneering digital payments and infrastructure orchestrator which specialises in issuer and acquirer processing, has revealed that 28% of merchants’ legacy in-person point of sale (POS) systems cannot support alternative payment methods like digital wallets and QR codes.
According to Tribe, these legacy POS system inefficiencies are rupturing revenue streams, leaving a gap that modern SoftPOS solutions can fill.
As in-person and contactless payments continue to soar globally, Tribe Payments’ research, conducted in conjunction with Censuswide, shows that merchants of varying sizes – from sole traders to multinational enterprises across several industry sectors – are struggling with a multitude of legacy POS terminal and infrastructure failings, causing lost sales due to payment acceptance difficulties, lengthy queues of frustrated customers, and compliance headaches.
The survey results, which forms part of Tribe Payments’ new report ‘Queue-Busters: Why SoftPOS Will Supercharge Merchant Payment Acceptance’, were gleaned from 500 merchants across a range of in-person payment sectors, including fashion, grocery, home and DIY, and general merchandise.
Other key findings include:
- 30% of merchants believe using outdated or inadequate payment technology infrastructure is their biggest challenge in maximising cross-selling and upselling opportunities at the checkout.
- 80% of merchants say the ability to accept a wide range of payment methods like QR codes and digital wallets is essential to secure sales.
- 63% cite a lack of specific data analytics capabilities in their current POS systems.
- 79% would leverage advanced analytics to enhance the customer experience and drive loyalty if they had the POS technology to do so.
Inefficiencies such as costly upgrades to the latest security and industry standards like PCI DSS, and being unable to integrate with other merchant systems like stock inventory and customer relationship management (CRM) platforms, are also threatening to eat into already-thin profit margins.
Additionally, merchants cite high maintenance costs of legacy POS systems. While many enterprise-scale merchants with multiple sites can afford to spend millions annually on maintaining their POS estates, small and micro merchants can find traditional POS terminals are simply too expensive to operate and lose customer sales as a result.
Tribe’s report outlines how SoftPOS solutions can solve these merchant pain points by slashing queue times, easing compliance obligations with instant remote updates, and empowering merchants to deliver hyper-personalised customer experiences.
As Tribe’s Head of Product Management, Robin Anderson, commented: “SoftPOS is a game-changer for merchants. It turns any mobile or tablet device running iOS or Android into a payment terminal, without the need for extra hardware like card readers. Unlike traditional mobile POS systems, it allows businesses to process payments, accept PINs, and handle contactless transactions directly on their device.
“What makes this even better is the freedom it gives by enabling untethered payment acceptance. Staff can move around the store, serving customers wherever they are, and take payments right on their smartphones or tablets. It’s also much more affordable than the standard POS terminals. On top of that, SoftPOS can communicate through open APIs in merchant’s other systems, like inventory, cashflow management, and CRM tools, offering a 360-degree view of the business in real time. That kind of insight can lead to hyper-personalised experiences, helping to build stronger customer loyalty.
According to Juniper Research, the global transaction value processed via SoftPOS will reach $11.8 billion by 2028, up from $1 billion in 2023, or growth of 1,050%.
Lynda Clarke, Chief Operating Officer of Tribe Payments, added: “It’s been 70 years since the first credit card was launched, and almost 45 years since the first POS terminal enabled in-store card acceptance. While tech has moved on, merchants are still shackled to clunky POS hardware that slows down sales.
“People in the US spend around 37 billion hours per year waiting in lines while the average Brit spends one year, two weeks and a day of their lives stuck in shop queues. Longer queues mean fewer sales, and for merchants, the true cost of legacy POS tech can mean billions of pounds or dollars in lost revenues, unhappy customers, and pressure on in-house sales staff.
“SoftPOS can sweep away so many of the pain points facing merchants. That’s why we have conducted this research, to show merchants of all sizes how they can unlock game-changing operational, data insight and sales efficiencies, garner more sales, and gain peace of mind through future-proof SoftPOS tech that can be updated instantly to accept new payment methods and adhere to changing industry standards and regulations.”
To read Tribe Payments’ SoftPOS report and full survey results from a cross-section of merchant sectors, download the report here: Why SoftPOS Will Supercharge Merchant Payments Acceptance | Tribe.
Built from the ground up, Tribe’s proprietary payment technology offers future-proof, customer-centric solutions for banking and financial services with a platform uptime SLA of 99.99%. By streamlining multiple interactions into one relationship and leveraging cloud-based services, Tribe enables clients to scale, expand globally, and navigate complex regulatory environments with speed and flexibility.
The company is riding a wave of impressive momentum amid rising demand for its services. Its revenue surged by 73% from 2022 to 2023, with its growth continuing throughout 2024 thanks to newly onboarded clients and their increased uptake of products. Companies in this story: Tribe
People in this story: Robin Anderson