10 Reasons FinTech Is Great For The Future Of Franchising

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A new franchise landscape has emerged for traders, business owners and customers over the past 18 months. All franchising companies, from small regional operators to global international chains, have had to adapt quickly to online payments, door-to-door delivery and social distancing in response to the measures being implemented to deal with the pandemic of COVID-19.

The resulting changes and technologies are now an integral part of the industry and are likely to endure in the “new normal”. In this article, I’ll list ten examples of technological innovations that fintechs can and should play an important role in improving the franchise model in the future, to the benefit of both merchants and their customers.

  1. Contactless payments

Consumer behavior has undergone a dramatic transformation during the pandemic, as customers have taken orders online and, in addition, have now fully embraced a digital lifestyle.

There are a number of technological innovations that will help business owners and franchise traders adapt to these changes by stepping up their digital capabilities.

For example, mobile applications dedicated to payment solutions such as Apple Pay and Google Pay enable one-click mobile loyalty subscriptions that avoid the need for plastic cards or for merchants to have individual applications by deploying the loyalty card. directly to a customer’s digital wallet and receive the benefits of what they may be entitled to as a loyal customer, for example, discounts.

  1. Scan to pay

Another interesting example of technology that is extremely beneficial for franchise businesses is scan-to-pay. Originally developed for the retail industry, the payment model can help businesses comply with social distancing measures, making it particularly relevant for the hospitality industry.

For example, quick service restaurant (QSR) consumers can now benefit from self-service scan to pay, allowing them to entirely avoid the need to interact with staff by using a QR code to log into the store’s digital system. Barcodes can then be used to scan each item before paying.

The technology can also take the form of scan & pay at the table, allowing customers to scan their tables to place orders that financial technology providers can bring them.

Several proposals exist on the market to support strong use cases, especially for QSR, via third-party applications such as Tabbed Out, Cover, Dash, and LyfPay, wallets or in your application.

  1. Centralized reporting on transaction volumes and SLAs

Some fintech-designed solutions provide a centralized data hub for a franchise chain. The benefits are numerous for the sellers by a total visibility at the central level.

For example, these provide insight into transactions, payments, terminals and provider performance. They make it easy to create financial analyzes using different filters. Such solutions allow 24/7 access to all cashless payments over the past 12 months.

  1. At your own risk

Another feature made available by fintechs allows franchise professionals to accept electronic payments if their payment terminal is not connected to the payment system. This technology allows traders to continue doing business even when there is an unexpected downtime.

  1. Omnichannel capabilities

The integral omnichannel capabilities of the modern payment ecosystem provide a consistent and reliable solution by connecting the dots between a customer’s online and in-store ordering. This capability will further enhance the customer experience, making it easier to tokenized payments and reward cards to their accounts across all platforms.

Such features make an omnichannel solution a must-have for both international franchise chains and regional restaurant chains, making it possible to book online through an app and find the closest franchisee available to pick up the goods.

The pandemic has also demonstrated such a need – to be able to book online and collect in store – hence the need for a consistent and reliable payment solution.

  1. Third-party apps for delivery

In order to maintain a certain level of sales and revenue generation throughout the pandemic, many franchise chains have also adopted third-party delivery apps, such as Just East and Deliveroo.

The subsequent reliance on these applications for taking orders, processing payments and arranging deliveries is likely to be a challenge for franchises, especially in the long term.

The adoption of this technology leads to having to share part of the profits with a third party. Businesses also can’t accept payments directly – everything has to be handled through an intermediary, which could cause issues and add an extra layer of complexity to a business’s payment infrastructure.

Some brands may find it difficult to integrate all aspects of their business with new digital systems, for example; gaps remain in the integration of loyalty programs. Starbucks, for example, has a digital version of its loyalty card but does not allow customers who order on Uber Eats or Just Eat to collect rewards.

Despite these challenges, merchants and business owners should keep in mind that third-party delivery apps have gained wide acceptance by the public, allowing access to a large number of customers. Increased sales becomes a realistic goal if the integration is done in the right way.

  1. Loyalty programs

All major QSR brands have released digital versions of their bespoke loyalty cards. It should be noted that other restaurant franchise chains have done the same, such as Nando’s.

The merging of these loyalty programs with payments allows for a better customer experience and is another facility that fintechs can provide to franchise businesses.

Then, tap and connect is a solution where the terminal will push loyalty cards to all people paying with their Apple or Google Pay. Such an offer will push the loyalty card into the user’s wallet.

Whenever users pay with their mobile, they will be identified and merchants will be able to push whatever rewards they might deserve.

  1. Subscription

The concept is to offer a subscription service to customers. Once registered, they will no longer be forced to engage in a daily cash register, significantly reducing contact between staff and other customers.

This technology has other benefits for franchise professionals as it increases loyalty and promotes upselling opportunities.

Two examples of chains that have adopted digital subscriptions are Panera Bread (USA) in 2020 and Burger King in early 2019.

  1. Dynamic currency conversion

This function is convenient for customers traveling abroad. This is to convert the amount of the transaction in the currency of the merchant into the currency used in the statements received by the cardholder from the card issuer.

  1. Facial recognition

One of the most common payment innovations is facial biometric authentication. The technology enables seamless payments for customers on drive-thru chains and is an initiative CaliBurger has rolled out since 2020.

Customers first smile at the AI-enabled self-order kiosks to log into loyalty programs. He can then place an order using a touchpad and smile again to validate and pay for his order. Kiosks allow businesses to track consumer preferences and habits, thereby offering products based on past purchases.

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About the Author: Lee Jones, Managing Director Northern Europe, GSV at Worldline

Lee is the Managing Director Northern Europe of Worldline and, alongside his team, has unmatched experience helping organizations deliver a reliable, secure and hassle-free payment experience.

Having held various leadership roles with leading technology companies over a 20-year period, Lee is passionate about designing solutions that deliver real added value to his clients.

Leading Worldline into new markets, where the introduction of cashless payments is just beginning to emerge while supporting existing customers in their ambition to meet and exceed buyers’ expectations, is something of great interest to Lee. Lee is proud of the trust customers place in Worldline and its team. Being able to help organizations reduce the cost, complexity and burden of PCI while securing their revenue and enabling them to increase their customer satisfaction scores is at the heart of Worldline’s strategy.


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