The Central Bank of Iran is expanding infrastructure for contactless payment via QR codes and digital wallets in a bid to limit the coronavirus outbreak via circulation of banknotes among the public or exchange of debit cards in retail outlets, an official with the bank said.
Bank authorities will build on efforts in the past to set up contactless payment mechanism, said Davoud Mohammad Beigi, the chief of CBI’s Payment Systems Department, adding that the process has gained momentum due to the rapidly spreading coronavirus in Iran.
“After coordination with Health Ministry and ICT Ministry, the scheme to expand contactless payment via QR codes has been given top priority,” he was quoted as saying by IBENA.
QR code payment is a contactless payment method where payment is performed by scanning a QR code from a mobile app.
In the QR code payment process, the user opens the payment app once the total transaction amount is set in the POS system of the retailer. The QR code payment app displays a QR code that identifies with the user’s card details. The retailer then scans the QR code with a scanner thus concluding the transaction.
For app-to-app payments both the sender and the recipient open their applications. The sender then scans the unique QR code that is generated in the recipient’s application. The sender, at last, confirms the amount to be paid and taps to complete the payment.
Mohammad Beigi pointed to the lack of unified standards and procedures among payment service providers as one of the main challenges of the payment scheme.
He said the regulator is in close contact with PSPs and national payment settlement network (locally known as Shaparak) to finalize the plan by the end of the calendar year (March 19) given the dire health conditions arising from the coronavirus.
“Reduced contact with contaminated banknotes, bank cards and POS devices in shops is crucial in efforts to avoid the contamination.”
Iran’s health officials have reported 6,566 cases of the novel coronavirus infection since its outbreak unntil Sunday with the death toll rising to 194.
Static Codes Preferred
QR payments could be handled via both static and dynamic platforms but the CBI scheme only covers the static QR code payments because of its convenience, according to Mohammad Beigi.
Static QR codes are used for facilitating quick and simple payments in various industries like delivery service, in-home services, retailers, taxi drivers, and street vendors. In all of this, all a user has to do is scan the QR code to pay without any hassles.
One of the biggest advantages of using QR codes is that it facilitates instant payment. Making payment via QR codes is extremely quick compared to other modes of payment. All a user has to do is simply open the QR code scan app, scan the QR code, and confirm to process the payment. Within a few seconds, the payments are made.
Making payments via QR codes is also highly secure. Any data which is transferred via QR codes is encrypted thus making the payment foolproof secure.
In addition, payment via QR codes is reliable as it eliminates the probability of error. The pattern of black boxes consists of unique data which enhances the reliability of the QR code payments.
