Payments

‘2020 was the year of QR code adoption — 2021 will be the explosion’: QR codes continue to climb in popularity

  • Past the three-month mark of 2021, we’re still seeing QR codes grow in popularity.
  • But how this payment method will expand continues to leave the future of QR codes kind of blurry.
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‘2020 was the year of QR code adoption — 2021 will be the explosion’: QR codes continue to climb in popularity

In December, payments firm Klarna partook in a fashion show in Australia. Instead of modeling outfits, models walked down the runway wearing robes and holding QR codes. The audience could then scan the QR codes to reveal the true outfits via their Klarna apps and buy the clothing on their phones.

But unlike the clothes showcased in the fashion show, QR codes aren’t likely to go out of style any time soon.

We’re past the first quarter of 2021, and we’re still seeing increased interest in QR codes. 11 million households in the US are predicted to use QR codes this year to make payments. Half of the restaurants in the US now offer QR codes.

“It’s replacing the physical menu, it’s going to replace the physical receipt, and even after everybody’s vaccinated, even after we go to where there’s no mask, I believe that QR codes are going to stay,” said Kevin Olsen, svp of payment solutions at VSoft.

As more companies explore new ways of implementing this payment method, 2021 seems to be the year for QR codes setting up camp in people’s shopping habits.

“In 2021, we can expect to see some businesses catching up by rolling out QR codes for the first time, and others consolidating their capabilities and enhancing their offerings,” said John Gessau, director of merchant payments at ACI Worldwide.

In its recent earnings call, PayPal, which launched its QR codes last year, reported a positive reception of PayPal and Venmo QR codes.

“I’m very pleased with the early reception of our PayPal and Venmo QR codes, which are now accepted at over 600,000 retail locations,” said Dan Schulman, president and CEO of the company.

PayPal signed 29 large enterprises in 2020, including CVS, Nike, and Macy’s, that are using in-store QR codes. According to the company, merchants saw double-digit growth in average basket sizes from consumers who shopped using QR codes. Last October, Venmo launched a beta version of its Visa-powered credit card that has a Venmo QR code on the front. The card was made available to the public in February.

Challenger bank Revolut has also taken an interest in QR codes. In February, Revolut Business — the challenger bank’s business banking solution — launched QR codes to allow users to process their customers’ payments in person while still keeping socially distant. Customers can pay through scanning a QR code using Visa, Mastercard, or Apple Pay.

This move came after the challenger bank’s launch of payment links late last year, which allow users to make and accept payments online. When that feature proved to be popular among customers, QR codes felt like a natural stepping stone for people who wanted instant transactions, as well as in-person payments.

“We saw that there was also an opportunity to improve the in-person payments experience for customers as well,” said Thibaut Genevrier, product owner for acquiring at Revolut. “This led us to introduce QR codes as a payment option to provide an additional method for businesses to get paid easily, straight away and in-person while still remaining socially distanced.”

Banking and payment firms have definitely turned more than one eye to QR code integration. With that being said, it’s interesting to ask how incumbents are incorporating QR codes. 

JPMorgan Chase, for example, announced this month that it’s officially killing off its Chase Pay app — a QR-based app launched in 2016 that acted as a digital wallet, allowing users to pay by scanning a QR code.

To provide QR code capability, Chase seems to be turning instead to its QuickPay feature powered by Zelle. Several other banks are turning to Zelle for contactless features like these as well, including Bank of America, TD Bank, and Wells Fargo, among others.

“To compete with Apple and other ‘pay’ apps, these banks have collaborated in their offerings, currently via Zelle,” said VSoft’s Olsen. “That said, we can expect to see more QR code usage from Chase as I anticipate more QR code activity from Zelle soon.” 

The increased interest in QR codes around the financial industry seems to point to this payment method sticking around for the time being.

“QR codes are on their way to the top — and will get there in time if a better simple, flexible and elegant solution is not introduced before [then],” said ACI Worldwide’s Gessau.

With so much increased interest in this payment method already popping up this year, QR codes could be making their way into ‘preferred payment’ status.

“2020 was the year of QR code adoption,” said Olsen. “2021 will be the year of QR code explosion.”

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