Should Your Restaurant Accept Mobile Payments?

Pros and cons of mobile payments in restaurants

Here are some of the biggest upsides and downsides of accepting mobile payments at your restaurant.

Pros

• Mobile payments are fast and easy. Mobile payments are a quick and convenient way for customers to pay for their food. It’s also easier for staff members to process transactions and get customers in and out of the restaurant.
• Mobile payments are relatively secure. There is no foolproof payment system, but mobile payments are considered relatively secure. They tend to be more secure than credit card payments because they often require biometric authentication.
• Mobile payments don’t require a physical wallet. Although customers occasionally leave their wallets at home, it is far less common for them to leave their phones, which serve as their digital wallets. This easy access makes mobile payments a convenient option for both customers and restaurants.
• Mobile payments allow you to offer rewards programs. Mobile payments and loyalty programs often go hand in hand. By accepting mobile payments, restaurants can offer customers mobile apps and distribute coupons, promotions and reward points through loyalty programs. These efforts can increase sales and encourage customer loyalty.

Cons

• Mobile payments can be a security risk. A major downside of accepting mobile payments is that they can raise concerns about data tracking and security. While mobile payments are relatively secure, some customers may worry about the potential for their transaction data to be tracked by third parties or stored insecurely. These concerns, coupled with fears of hacking or data breaches, may make some customers hesitant to use mobile payment options.
• Mobile payments require updated hardware. Depending on your restaurant’s current setup, accepting mobile payments may require updating your point-of-sale (POS) system and hardware to accommodate near field communication (NFC) technology. This could represent a significant upfront cost.
• Mobile payments may not be universal. Despite growing adoption, not all customers have smartphones with mobile payment capabilities or may simply prefer to pay with cash or credit cards. Offering mobile payments as the sole payment option could alienate a portion of your customer base.
• Mobile payments are subject to transaction fees. Like credit card payments, mobile payments are subject to transaction fees. These fees can add up, particularly for smaller restaurants with tight margins. While the convenience of mobile payments may outweigh the costs for some businesses, others might find the added expense a drawback.

What to consider when deciding to accept mobile payments at your restaurant

Restaurants must continually innovate to earn repeat business and grow their clientele. Allowing mobile payments is one way to encourage customers to dine at and return to your establishment. However, if you’re unsure whether mobile payments are right for your eatery, consider the following questions. 

Are your customers younger? 

Mobile payment users are predominantly Gen Zers and millennials, with growing adoption among Gen Xers. Younger users are typically quicker to adopt new technologies, while many Gen Xers are becoming more comfortable with mobile payment options. 

If you want to build a brand that attracts Gen Z and millennials while also appealing to Gen X and savvy boomers, accepting mobile payments may be a smart choice for your business.

Can you ensure payment safety? 

Your restaurant patrons may be intrigued by mobile payments, drawn to their convenience, and excited about the potential to earn rewards and discounts. However, many are likely cautious about payment security and acutely aware of the prevalence of credit card fraud. 

To ensure customers are comfortable using mobile payments, choose a mobile POS system with advanced security features, including robust encryption and authentication protocols. To build trust and encourage adoption, educate your staff and customers about how these measures protect their transactions.

Would mobile payments help increase your sales?

Mobile payments are fast and convenient, which can reduce transaction times and lead to quicker table turnovers. This improvement in efficiency may allow your restaurant to serve more diners in a single day, potentially boosting overall sales. Additionally, one study found that customers charge an average of 9.4 percent more on credit cards than they do when paying in cash, suggesting that mobile payment options could encourage higher spending.

However, not every restaurant would benefit equally from these factors. For example, if your establishment prioritizes a slower-paced experience where table turnover isn’t a priority — such as fine dining — or if your customers predominantly prefer cash payments, the impact of mobile payments on sales might be less significant.

Would mobile payments save you money compared with cash payments?

Some restaurants hesitate to adopt mobile payments because of the transaction fees, which typically range from 1.5 to 3.5 percent per transaction depending on the processor and card type. However, it’s important to evaluate the hidden costs associated with handling cash.

If your restaurant processes large amounts of cash, you may face bank fees for deposits. Additionally, managing cash involves labor costs such as counting, reconciling and depositing it.

Cash-heavy businesses are also at a higher risk for theft, both internally and externally. For these reasons, many restaurants find that mobile payments improve their bottom line despite the associated transaction fees.

Would mobile payments improve customer satisfaction?

Offering mobile payments could significantly enhance customer satisfaction by providing a faster and seamless checkout process. Long lines and slow transactions can frustrate diners, especially during busy hours, but mobile payments can speed things up and provide a great customer experience.

Additionally, most restaurant POS systems with mobile payment functionality support loyalty programs, allowing you to reward customers with points, discounts and exclusive offers. 

How to accept mobile payments at your restaurant

Accepting mobile payments at your restaurant is a straightforward process, just like accepting credit card payments. Here’s how it works:

1. Implement a point-of-sale (POS) system. Choose a restaurant POS system that supports mobile payments. Your POS system should allow you to accept a wide variety of digital payment methods and have robust reporting capabilities. Additionally, ensure that the mobile payment system you select integrates with your current accounting software.
2. Install an NFC reader. You’ll need to install a near-field communication (NFC) reader, which enables contactless payments by allowing communication between the reader and a customer’s mobile device. Once it’s in place, run a few test transactions to confirm everything processes smoothly before going live.
3. Train your employees. Invest in employee training to ensure all team members can use the restaurant POS system and process mobile payments. Ideally, your POS system should have an intuitive interface and offer employee training as a part of the onboarding process.
4. Ensure payment security. Confirm that your POS system and NFC reader include encryption and authentication features to protect customer data. Additionally, ensure that your staff understands best practices for handling mobile payments securely.
5. Promote your mobile payment acceptance. Display signage at your restaurant to let diners know you accept mobile payments. Highlight perks such as faster checkouts or loyalty program integration to encourage usage.
6. Link your loyalty program to the POS system. Optionally, take advantage of your mobile POS system’s loyalty program capabilities by setting up and linking your rewards program. This integration lets you automatically track diners’ purchases, offer rewards and incentivize repeat visits.
7. Evaluate and improve your mobile payment system. Gather feedback from both customers and staff on how the mobile payment experience is working. Use that input to identify any issues and make adjustments that keep the checkout process fast and seamless.

Best restaurant POS systems for accepting mobile payments

The best restaurant POS systems help you accept mobile payments while streamlining your eatery’s operations and providing insights that inform better decision-making. Here’s a quick comparison of top options, followed by a closer look at each.

• Cake: Cake is a highly intuitive and exceptionally easy-to-use restaurant POS system. It’s also one of the most affordable options, making it a good choice for newer establishments. Our comprehensive Cake review details features like its guest management system, loyalty integration and self-checkout features.
• Clover: Clover is an exceptionally comprehensive option for any restaurant that wants to accept mobile payments. For example, the Clover Go app works with the Clover Go device to turn a smartphone into a mobile POS system. As we explain in our Clover POS system review, the robust hardware options are particularly well-suited for restaurants that want to offer tableside checkout and contactless payment options.
• Toast: Toast is a popular restaurant POS system that provides durable, restaurant-grade hardware. The software’s restaurant-specific features include tableside service, online ordering and menu management. As our Toast review explains, this vendor also offers flexible options for your restaurant payment processing, including a fixed monthly rate and a percentage-based option.
• TouchBistro: TouchBistro is an excellent option for restaurants of all sizes, and it comes with the hardware and software you need to accept mobile payments. As we detail in our TouchBistro review, this hybrid system allows you to accept payments and orders even when the system is offline.

Should your restaurant accept mobile payments?

For most restaurants, the answer is yes. Mobile payments are no longer a novelty — they’re an expectation for a growing share of diners. Accepting them can speed up service, support loyalty programs and signal to customers that your business is keeping pace with how people pay.

Ultimately, the question isn’t really whether your restaurant should accept mobile payments — it’s which mobile payment methods are the right fit for your operation and how to implement them without disrupting your service or budget. With the right setup, mobile payments can be a genuine competitive advantage.