Posted February 08, 2021 by FreedomPay

The Rise of Touchless Commerce and What’s Next for Privacy Shield Protocols

By: Bernard Clary, Associate Director of Compliance at FreedomPay

The privacy protocols that have been integral to the international adoption of touchless commerce are now in flux as payment practices evolve at a differing pace and with differing agendas across varying geographies and market sectors.

Everyone is fully cognizant of the effect that the COVID-19 pandemic has had on all our purchasing habits and decisions. Among many other concerns, initially everyone grew to fear catching the virus from touching infected surfaces. This included the point-of-sale terminals where cards were used and buttons pressed. Quickly the cleanliness of the entire sales and purchase chain became one of trust in the sanitary precautions taken by the vendor to protect the customer.

However, the rise in contactless commerce has moved beyond a purely sanitary issue as people have grown to appreciate the benefits of touchless transactions in terms of speed, security and ease of use. People have learned to forget, or at least there is a conscious decision to move away from the old-fashioned “swipe and dip.”

How then are merchants adapting to this change in consumer mindset and expectation? Are they capable and ready to evolve? The answer to that is that some sectors have been quicker than others to embrace the new “normal.”

For example, restaurants and food outlets have moved quickly and contactless transactions have become the preferred way to pay. Retailers, on the other hand, remain busy looking at a variety of potentially optimal payment and collection solutions.

Is protocol overload coming?

The whole digital transformation journey has not been smooth sailing. The seemingly “new normal” brings many issues around data recognition, data storage and the consequential dilemmas surrounding security, privacy and the EU’s General Data Protection Regulation (GDPR). All of these become business requirements, and solution providers need to create solutions that satisfy the needs of the merchants and the very natural concerns of the customer in all walks of life and the e-commerce ecosystem.

The privacy shield protocols that have been integral to the international adoption of touchless commerce are also in flux. As payment practices evolve at a differing pace and with differing agendas across varying geographies and market sectors, the tightening of rules and standards becomes an increasingly complex set of issues.

Improvements to the collection and use of personal data is of clear concern. With the disengagement of the privacy shield agreement last summer, there now appears to be a push from the European Union to add a standardized set of clauses to existing merchant contracts regarding data transfers to ensure the protection of data at least on a case-by-case basis. This is likely to be further complicated by the withdrawal of the U.K. from the EU, and will Brexit require new rules to be established between Great Britain and the EU?

Focal point: personal data protection

The legal debate is expected to continue for months, and regardless of what the agreement is, the impact has been felt by businesses of all sizes across multiple sectors and geographies. One thing for sure is that everybody accepts that personal data needs to be protected — and that this issue is indeed a fundamental human right. Most consumers have no idea what level of protection they have been afforded when they carry out any manner of transactions, or indeed what will or could happen to such data when gathered.

Merchants may have a moral obligation to offer agreed levels of protection and confidentiality, but at the same time it is the responsibility of the consumer to be much more careful of what they “share” with the worldwide marketplace. This will certainly help shape the future of e-commerce as people become more aware of the way things are evolving — and should lead to interesting, and to a certain extent, unpredictable times ahead. Watch that space!

 

Read the original article on Kiosk Marketplace here.

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