Restaurant Adoption of pay-by-phone systems

[Brian Lutz]

(Was originally going to post this in the table tablet thread, but this topic probably warrants a separate thread.)

Over the past year or two I've noticed that a lot of smaller chains and single-location restaurants have begun to move toward pay-by-phone (QR code on receipt) solutions for payment, although with exceptions (like IHOP and Cracker Barrel) larger chains seem to be fairly slow to adopt this approach.

Heartland is probably the most common pay-by-phone solution among small local/regional chains and 1-2 location places around here (Heartland seems to be primarily a POS provider for restaurants which integrates pay-by-phone and loyalty functionality, although it does require the use of their mobile app.) I'm not particularly impressed with Heartland's solution though, as I find I frequently get logged out of the app and have to manually reenter payment info when I try to use it. ToastTab is another one used by a number of mostly single location restaurants which has the advantage of not requiring an app download, and which generally seems to get the job done.

From my experience Cracker Barrel seems to have the best large chain implementation of pay-by-phone; Payment through the website is generally quick and mostly painless. Although they have improved slightly, IHOP's solution is still one of the worst I've seen. It requires using their app with a login, does not provide an option for an emailed receipt, requires manually entering payment info every time, and I don't think the servers are properly trained on it a lot of the time so using it just serves to confuse them.

[Super S]

I will not do any money related functions on my phone. A restaurant offering this as the only payment option will alienate quite a few customers.

[Alpha8472]

During COVID I went to a local brewery restaurant and they had a QR code on the table to scan for online ordering. I ordered and paid on my phone with no app needed. I thought that it was easy to use and my food was delivered to my outdoor table.

I can see how eliminating waiters might be a cost saving thing for restaurants, but often waiters can recommend more food and answer questions. This will increase sales of food.

Ordering online will make people order less food since they are unsure of the full menu.

[HCal]

I will not do any money related functions on my phone. A restaurant offering this as the only payment option will alienate quite a few customers.

I've never seen any restaurant offering this as the only payment option. They will still take your card and process it like normal if you want. I'm sure many elderly people (like my parents) have never used QR codes and have no interest in them.

I like these things if they can link to Google/Apple Pay. But if I have to type in my card details, at that point I will cancel it and pay the normal way.

[ClownLoach]

I will not do any money related functions on my phone. A restaurant offering this as the only payment option will alienate quite a few customers.

At this point, as long as you don't fall for scams, you're much safer using applications like Apple Pay or Google Wallet instead of your physical card. The security is substantially higher, zero risk of data breach capture of your card or any kind of card skimmer.

Flip side as discussed in the other thread, the QR code payments for restaurants are both causing massive losses for restaurants as well as fraud. The ones using physical stickers are getting hit with fake sticker attacks that divert the customer to a fake payment site so they think they've paid but the check is not closed. Customer and server might get into a dispute, customer shows server notification from their bank they've been charged and the server figures they'll solve it later but of course not only is the restaurant not paid but the customer's account is drained later with false charges. Texas Roadhouse, Cheesecake Factory, Din Tai Fung, Yard House, and a few other big chains have already killed the QR payments and gone back to either handling cards themselves, wireless readers or Ziosk. As mentioned elsewhere there is extensive fraud with people who go through the motions, show what is actually a screenshot of a past transaction etc. and don't actually pay the check too, causing thousands of dollars in losses. My understanding is BJs still uses this technology but is training their employees to tear the receipt in half to cut off the QR code and they're sending servers to take payments on their iPads, which is entirely manual right now and probably getting charged a higher fee as card not present.

Never, never, never pay anyone in any fashion using a QR code unless it is a screen based system with changing QR codes and you trust the hardware is physically sealed and secured/not tampered with. Examples include the gas pump at Sam's Club where you use their app to scan their proprietary on screen code to pay, that's much safer than using physical card where a skimmer could be installed. App based systems are reliable like ParkHero but I would not scan the QR code to download the app, use the app store and search for them instead and then enter the parking lot number to pay. Otherwise I assume all posted QR code payment systems are fraudulent.

I see zero benefit to a restaurant restricting to the QR code especially because they pay more as it is considered a "card not present" transaction with a higher processing fee. This is why the credit card processors rushed this stupid technology out there when there was contact contamination fear of COVID so they could make a fast profit. If one was asking for you to only use QR and refused normal payment by card then I would seriously question if they have something else bad going on they're aware of like they found their credit card readers were tampered with or network hacked etc. and are operating with QR as a workaround until they can get new readers, PIN pads etc. Of course if they confessed to that I would politely tell them whether they like it or not I'm going to go get cash from a (reliable and safe) ATM to pay them because they are operating in a reckless and unsafe manner that exposes their customers to fraud.

[veteran+]

I will not do any money related functions on my phone. A restaurant offering this as the only payment option will alienate quite a few customers.

Same with me!!

[Brian Lutz]

Requiring the use of an app to make payments, although somewhat inconvenenient, does mitigate the potential for QR code fraud by adding an intermediate step in the process (a legitimate QR code would likely not work outside the app or would only point to an app download), and some of the apps will also use Apple Pay / Android Pay if it's installed. Cracker Barrel also puts a 9-digit code and instructions on their receipt to go to a known URL (https://www.crackerbarrel.com/mobilepay) and enter the code to make the payment as an alternative to using the QR code. I have never seen a restaurant offer this as the only payment option, although I do see some food trucks that want payment through PayPal or Venmo.

[BillyGr]

Flip side as discussed in the other thread, the QR code payments for restaurants are both causing massive losses for restaurants as well as fraud. The ones using physical stickers are getting hit with fake sticker attacks that divert the customer to a fake payment site so they think they've paid but the check is not closed. Customer and server might get into a dispute, customer shows server notification from their bank they've been charged and the server figures they'll solve it later but of course not only is the restaurant not paid but the customer's account is drained later with false charges. Texas Roadhouse, Cheesecake Factory, Din Tai Fung, Yard House, and a few other big chains have already killed the QR payments and gone back to either handling cards themselves, wireless readers or Ziosk.

Never, never, never pay anyone in any fashion using a QR code unless it is a screen based system with changing QR codes and you trust the hardware is physically sealed and secured/not tampered with.

If I read the original post correctly, the restaurant still hands the customer a (printed) bill and the code is on that - thus no way to have any fake issues (since no one has access to put such a sticker on, plus even if they did it would be obvious on a piece of paper).

[ClownLoach]

Flip side as discussed in the other thread, the QR code payments for restaurants are both causing massive losses for restaurants as well as fraud. The ones using physical stickers are getting hit with fake sticker attacks that divert the customer to a fake payment site so they think they've paid but the check is not closed. Customer and server might get into a dispute, customer shows server notification from their bank they've been charged and the server figures they'll solve it later but of course not only is the restaurant not paid but the customer's account is drained later with false charges. Texas Roadhouse, Cheesecake Factory, Din Tai Fung, Yard House, and a few other big chains have already killed the QR payments and gone back to either handling cards themselves, wireless readers or Ziosk.

Never, never, never pay anyone in any fashion using a QR code unless it is a screen based system with changing QR codes and you trust the hardware is physically sealed and secured/not tampered with.

If I read the original post correctly, the restaurant still hands the customer a (printed) bill and the code is on that - thus no way to have any fake issues (since no one has access to put such a sticker on, plus even if they did it would be obvious on a piece of paper).

Massive fraud issue. The customer pretends to pay but doesn't. There were even people who were sharing screen shots on social media of the "completed transaction" pages for big brands to show to the staff. Then the customers leave quickly and the restaurant discovers the check isn't paid at all. Some of the big chain restaurants were losing thousands of dollars to these modern dine and dash frauds.

Some of the restaurants were using a QR code on the receipt which is theoretically secure although many were a standard code (not unique to the transaction) which could have been altered with malware attacks on the POS. But others (like BJs) were posting a sticker on each table with your "table number" and asking you to scan that to pay your check then enter the number. Those are the ones that put the customer at risk although I'm sure they would theoretically not be easy to apply fake ones to many tables without being caught as the restaurant would notice checks not closed out.

Ultimately the QR code on your phone is a larger threat to the restaurant because they both pay more (card not present transaction) and it makes it easy for sleazy customers to dine and dash by pretending to pay but not actually doing it.

Customers seem to be getting used to the wireless devices and are now more comfortable with them, which is why many restaurants are moving towards those.

[BillyGr]

If I read the original post correctly, the restaurant still hands the customer a (printed) bill and the code is on that - thus no way to have any fake issues (since no one has access to put such a sticker on, plus even if they did it would be obvious on a piece of paper).

Massive fraud issue. The customer pretends to pay but doesn't. There were even people who were sharing screen shots on social media of the "completed transaction" pages for big brands to show to the staff. Then the customers leave quickly and the restaurant discovers the check isn't paid at all. Some of the big chain restaurants were losing thousands of dollars to these modern dine and dash frauds.

Then have someone at/near the door who REQUIRES you show proof of payment before you can leave (actual proof, like a message sent to their email or similar that would show the amount paid and time of payment, or have some way that it connects to their in-house system where they can scan the paper bill and it will come up showing paid, just as they scan them to bring up the order to let you pay with a card or cash).

But they are probably like all the retailers, they want to complain but not actually go after those who are causing the problems.

P.S. - When I said no fake issue, I meant that there wouldn't be a way to stick a fake code on a printed bill like was done with the on-table ones, not really referring to people just opting to fake payment.