New Context

New Context

Choosing Terminal-Less Payments that Require No Initial Investment

People no longer carry cash with them at all times. They can shop using many different payment methods as long as they have a credit card or smartphone. At the same time, many business operators are hesitant about introducing cashless methods because of the costs and labor involved with payment terminals. This is why people are paying attention to methods that do not require a specialized payment terminal, and can be completed with a  QR Code or NFC tag. They cost no money to introduce and do not even require registers.

What exactly does “terminal-less” mean? How will shopping experiences be different in the future? We spoke with Keita Otake, manager of the Marketing Department at DG Financial Technology, Inc. (DGFT), which offers the terminal-free payment service “CloudPay Neo.”


Manager of the Marketing Department; Sales Division; DG Financial Technology, Inc. (DGFT)

Keita Otake

Joined Digital Garage, Inc. in 2017 and worked in promotion for app development companies. Transferred to DGFT in 2022 and helped launch the terminal-free payment service “CloudPay Neo.”

Accepting a wide range of cashless payments without any terminals

“Terminal-free” means that a business operator can take payments without specialized terminals. All they need is a QR Code or near-field communication (NFC) tag to accept credit cards, PayPay, and a wide range of other cashless payment methods. This is especially popular among companies that do not have physical stores, such as moving and repair services. Otake said there are two main reasons for the rapid increase in companies implementing these payments that are drawing so much attention in multiple industries.

“The first reason is drastically lower costs. Naturally, terminals cost money to install. There is a global semiconductor shortage that is causing electronics prices to rise. Terminal costs increase with multiple stores or when giving each employee one to carry with them.”

“Another reason is avoiding terminal-related issues. Even the best terminals can experience problems like being unable to read a card or not turning on. And if it’s a portable device, they can be dropped or lose power.”

“Terminal-free payment also benefits the customer because they input credit card information on their own phone, which reduces the risk of skimming and other methods used to steal card information.”

An increasingly popular payment system that can be used in unexpected circumstances

Terminal-free payment systems are a recent invention born from technological progress. There are still few varieties available, and not many companies offer them.

“There are currently two types of terminal-free payments. The first is QR Code payment, in which the business displays the payment code on physical paper or digitally. The consumer reads the QR Code with their smartphone to launch the payment screen, input the required information, and complete the payment. The store can link this with their point of sale (POS) system to automatically record what was sold, when, and how much it cost at the time of payment.”

“With NFC tags, the business only requires a special IC chip. These have different prices depending on the service. There are no costs with DGFT’s “CloudPay Neo,” a terminal-free payment service. The consumer taps their smartphone on the NFC tag to launch the payment screen, making it even more convenient than QR Codes.”

Companies that offer services directly to consumers without physical stores are actively introducing terminal-free payments. This includes moving companies, repair companies, and home delivery services. Otake says use is also increasing in another sector recently.

“More people are using terminal-free payment for events. For example, a company implemented our service for a food booth at a recent event. More businesses are also introducing it as part of their business continuity plans (BCPs) to offer alternative methods when terminal issues occur. Their thinking is to allow consumers to pay using familiar methods, and to also offer terminal-less payment in case their terminals aren’t working.”

Terminal-free payment is becoming essential infrastructure for emergencies

Terminal-free payment may be able to drastically transform purchasing experiences for consumers. Stores could remove their registers to free up space, and customers would not have to line up and bring products to the register. DGFT is actually making these arrangements with an apparel company.

“We are planning with the apparel company to create stores without designated payment areas. When a customer finds a product they wish to buy, they pay for it right there and tell an employee, who checks that the payment has been completed and switches the display product for a new one. This accomplishes smooth purchasing and more streamlined interior spaces, since there are no registers.”

Otake said that terminal-free payment can also function as emergency infrastructure.

“Japan is a place with many types of natural disasters. After the devastating Great East Japan Earthquake, the tsunami resulted in all electronic devices becoming unusable, and many stores could only accept cash. But if you don’t have cash, you are stuck when ATMs are also out of service. With terminal-free payment, consumers can buy things as long as their smartphones are working.”

Creating a world where terminal-less payments are the norm

Terminal-less payment has the potential to drastically change future shopping experiences. There are two unique characteristics of “CloudPay Neo,” DGFT’s terminal-less payment service.

First, it helps keep installation costs low because there is no need to pay for a specialized terminal, and no labor required for complex system settings. DGFT provides all the required payment processing screens. The admin screen is frequently updated according to user requests, with repeated improvements to provide optimal purchasing experiences to consumers.

Second, there are few issues when using “CloudPay Neo.” As mentioned previously, there is a lower possibility of unforeseen events because the service involves no terminals. DGFT also utilizes the Digital Garage Group’s many years of technical expertise to help prevent system errors. The long-term stability of these services is demonstrated by their use in the public finance field, which highly values past track records. We also asked Otake about future developments for “CloudPay Neo.”

“First, I want to keep increasing the number of companies that utilize “CloudPay Neo.” It’s been just eight months since we launched full-on sales, and I’m happy to say that many companies have decided to introduce the service. I want to help them smoothly implement it in line with their individual circumstances.”

“We will also keep improving the service and announcing details as necessary. Most recently, we are planning on equipping it with functions for local governments. My goal is to help create a world where terminal-less payments are the norm, eventually leading to a society with absolutely no payment terminals.”

Although many payment methods are being released, we will likely reach the limits of these terminal-based services. Considering the Sustainable Development Goals (SDGs), it makes no sense to develop new terminals for each new payment method. We look forward to a world of terminal-less payments, and to seeing how this transforms our everyday shopping.

“CloudPay Neo,” a terminal-less payment service

Terminal-less payment service that allows customers to easily make payments by simply scanning a QR code when making purchases through door-to-door sales, services, or in-store transactions. By entering into agreements with DGFT and member merchants, it is possible to establish a payment environment without the need for terminals.