QR Code Payments – What’s in It for Merchants?

Short for a quick response code, QR codes have revolutionized and sped up payment procedures. 

From brick-and-mortar stores with QR codes labeled to counters to online payments where they’ve made the entire process faster and frictionless, QR codes have changed our lives.  

This article explains how QR code payments work and why they’ll keep growing in the future. 

What Are QR Code Payments?

A QR code is a digital, two-dimensional digital barcode that keeps relevant data in the form of pixels. The relevant data are payment information, a website link, address details, etc. 

When a QR code is scanned with a mobile app, the user gets access to the data and continues with the process in question (money transfer, in this case). 

QR Code in Action

Let’s now get into the details of QR code payments. The first part refers to a merchant generating a QR code, containing the following steps:

  1. The customer wants to make a payment, so the cashier launches the Checkout procedure. 
  2. The cashier’s computer forwards to the amount to be paid and the order ID to the payment processing entity, i.e., the payment service provider (PSP). 
  3. The PSP stores the information on the server and generates a QR code URL, and sends back the QR code URL to the cashier’s computer. 
  4. The QR code URL is then forwarded to the checkout terminal, which displays the QR code on the cashier’s computer. 

The second part of every QR code payment includes several steps in which the consumer completes the payment, as follows: 

  1. The customer opens their digital wallet and scans the QR code to initiate the payment. 
  2. The amount to be paid is shown in the consumer’s digital wallet. If the amount is correct, the customer selects the Pay button. 
  3. The digital wallet sends a notification to the PSP that the amount in question has been paid. 
  4. The PSP labels the QR code as paid – confirming the payment to the digital wallet – and notifies the merchant that the QR code transaction has been completed. 

If there weren’t QR codes, customers would have to manually enter the payment URL into a merchant’s form and/or at the point of sale. This tech feature saves everyone’s time while ensuring a secure payment environment. 

Dynamic Codes vs. Static Codes

The procedure we’ve described above refers to dynamic QR codes. They’re called dynamic because they’re active for a limited interval, i.e., only until the payment is completed. It’s another security feature that makes them safe and handy. 

Static codes, on the other hand, contain information that can’t be edited. Once the data has been included in a static QR code, it becomes permanent. For instance, a retailer may place a printed QR code at the billing counter for fast, contactless payments. Such an addition may increase their revenue, due to a larger number of served customers and processed payments per unit of time. 

TPP Intel: We’re witnessing how 2024 is making way for further tech advancements in the payment world. For instance, softPOS is one of these innovations – the option to install a software point-of-sale terminal on a merchant’s smartphone. What’s more, you can set up a static QR code within this softPOS to additionally facilitate contactless payments, inside and outside stores. Read more about the current fintech innovations in our article Payment Technology 5.0: What Awaits Us in 2024

Security Features of QR Codes

Every novelty in the payment industry always raises one key question: is my financial data secure? The same goes for QR codes and the answer is affirmative: QR code payments are safe. 

For starters, all the card transactions are forwarded to their relevant card networks, like Mastercard, AmEx, or Visa. These companies have strict, multi-layered protection systems, from data encryption to multifactor authentication

Furthermore, tokenization and encryption are behind QR code transactions, meaning that personal information isn’t visible in such payments, but they’re vaulted within tokens. 

Finally, the global payment playground is getting crowded with teams from different regions. To cut a long metaphor short: merchants typically offer numerous globally available payment options to meet different tastes. For some customers, being able to choose their domestic or preferred international method isn’t only considered convenient but also secure.

Benefits of QR Payments

Having explained how QR payments work and why they’re secure, now we’ll sum up the major benefits of making/accepting payments with QR codes:

  • Quicker payments. Merchants can receive more QR transactions per unit of time than traditional online payments. The latter might sound like an oxymoron – a traditional online payment – but that’s the actual state of things: in 20 years, we’ve come a long way in online payments, so that now entering credit card details is considered classic, even slow. QR codes make a positive disruption in this context. 
  • Straightforward setup. Everything about QR codes is more cost-effective compared with their hardware counterparts. Customers don’t have to manually enter their long card numbers and PINs, and merchants can enjoy the benefits of static QR codes on softPOS solutions. 
  • Seamless consumer journey. Paying via a QR code at the end of a pleasant customer journey is just like a cherry on the top of a cake; especially if you’ve ordered that cake online and paid to the merchant using one such code upon delivery. The less friction the consumer experiences while gliding through the purchase funnel, the better for their business development. 

With the further automation of online transactions and implementation of cutting-edge features (AI, cybersec tools, innovative providers), QR codes will be even more important for seamless e-commerce experience(s). 

TPP Intel: A report published by Deloitte shows that the global market of QR code payments will keep growing at the CAGR of 16.1% in the 2021-2029 interval. The same research claims that the annual expenditure via such payments will have surpassed $ 3 trillion by 2025, with 2.2 billion QR payers. All this intelligence indicates that merchants and payment facilitators should and will keep developing QR code payments. 


QR codes benefit both merchants and consumers to complete their purchases securely and swiftly. In an environment dominated by digital advancements, QR codes connect the online and offline worlds, which makes them unique in the context of e-commerce payments. ThePayPortal facilitates all sorts of transactions for their merchants and helps them generate various options. For more guides like this one, follow our website and blog. For a new merchant account, follow this link: https://thepayportal.typeform.com/precheck?typeform-source=mail.google.com