How QR payment codes work and how to create them: A small business guide

From fast, easy payments to interactive marketing campaigns, QR codes for businesses can be a game-changer. They have helped revolutionize the way merchants interact with their customers, opening the door to a new level of connectivity.

How do QR codes work?

A QR code may look like a random mix of scribbles and black-and-white squares, but each slice contains several layers of information. When scanned with a compatible app, all that information gets put together in the right order for the code to be read, and the square markings in the corners of a QR code tell an app the orientation of the code.

But how do you scan a QR code? There is no right or wrong way. Customers can scan the code from any angle without worrying that it will be read backward. Alignment markings embedded in the code tell the app if the surface the code is printed on is flat or curved so the app can "straighten" out the code to read it correctly.

If you've noticed that QR codes have a space surrounding the square, you may be surprised to learn that space is considered part of the code. It's called the quiet zone, and it's there to help the smartphone app recognize where the code stops.

Learn more about the differences between the two scanning technologies: QR codes and barcodes.

How do QR codes for payments work?

Because a QR code can hold far more information than a barcode, it can be safely connected to payment processors like PayPal. With QR codes, you can start accepting contactless payments in just a few minutes, all without physically handling cash, signing receipts, or even interacting face-to-face. The scanning process allows the payment app to decode the information and initiate the transaction, enabling swift and convenient cashless payments.

What are QR codes used for?

From sending emails to accepting payments, QR code uses are vast and varied.

It’s also important to understand that there are two different types of QR codes:

Uneditable QR codes

This type of QR code stores data that, once created, will be uneditable. In other words, you won’t be able to update the QR code information. For example, if you create a QR code for a one-time campaign, there will be no option to revise that same QR code a few months later with a different campaign. These QR codes are best used for linking a company website, email, or another piece of information that is unlikely to change.

Editable QR codes

Also known as dynamic QR codes, these QR codes can be updated indefinitely. For instance, if you want to redirect customers from your website to a campaign landing page, you can simply amend the QR code without creating a new one or risking a 404 error.

No matter the type you use, QR codes can store all types of information, including (but not limited to):

• Payment portals

• Links to websites, landing pages, and other relevant content for a business

• Contact information

• App download pages

• Social media profiles

• Discounts or promos

What are the benefits of offering pay with QR code to your customers?

There are many benefits of QR codes for small businesses. QR codes have the potential to transform the payment process and improve customer experiences.

The most notable QR code benefits include:

• Saved time: Once you create a QR code, you can start taking payments immediately. Just print your unique QR code on paper, stickers, and signage, and then display it where it's easy for customers to scan. You can also display your QR code online.

• Improved efficiency: QR codes can hold much more data than UPC barcodes, making them ideal for complex processes like payments.

• Greater reliability: Because QR codes are read in various directions, they can still be recognized by a scanner, even if the QR code itself is damaged or partially torn.

• Better speed and accuracy: QR codes can quickly and accurately share details needed to connect buyers and sellers in real time. Simply scan the QR code and click through the link to access the information in seconds.

Getting started with QR code payment solutions

It's important to find the QR code payment solution that best meets your unique business needs and can be integrated into your payment processes. When selecting a QR code payment solution provider, consider these key factors:

Compatibility: Opt for a provider that supports a wide range of devices and operating systems to accommodate your customer base. Ensure the solution is compatible with popular mobile payment apps and can be seamlessly integrated into your existing POS system.

Security: Choose a provider that employs robust encryption protocols and complies with industry standards for secure transactions.

Ease of use: Select a solution that offers a simple and intuitive interface for both customers and staff. The scanning process should be straightforward, and the payment confirmation should be clearly displayed.

Customization: Look for an option that allows you to incorporate the QR code in your brand and your way of doing business. This may include integrating the payment QR code in your printed marketing materials or customizing the code with your brand colors and logo.

Transaction speed: Swift transaction processing is essential for a seamless customer experience. Choose a solution that ensures payments are processed quickly.

Cost: Evaluate the pricing model of the provider. Some charge a flat fee per transaction, while others may deliver a subscription-based model.

Support for multiple currencies: If your business deals with international customers or currencies, choose a provider that supports multi-currency transactions.

How to get a QR code for your business: steps for getting paid

Setting up a QR code is relatively simple and quick. It doesn’t require any special hardware or scanners, making it easier to use compared to other touch-free payment types. When customers shop in person, paying via QR code can be as simple as clearly displaying the code and allowing them to scan it with their phone’s camera and pay via an online payment processing portal or an app like PayPal.

Here's a quick step-by-step guide on how to get a QR code for your business and accept QR payments with PayPal:

1. Get your QR code: Not sure how to create a QR code for payments? To access your QR code, log in to your PayPal account and download it. You can also create your code using the PayPal Business app.
2. Display your QR code: Print your code and hang a copy wherever a customer can easily scan it during the checkout process, like on your register or counter. You can also display your QR code on your register screen for customers.
3. Shopper scans the QR code: When your customer is ready to check out, they log into the PayPal app, click Scan and Pay, and then Allow, which tells the app it can use the phone's camera to scan the code. They hold their phone up to your QR code like they're taking a picture, and the PayPal app uses the camera to read the code and connect to your business's PayPal account. User can also use native scanner to launch the PayPal app.
4. Receive your payment: The customer then enters the amount they owe you and presses Send. Their payment appears in your PayPal account, and the transaction is complete.

Learn more about how to receive payments from customers using a QR code.

QR code best practices

Once you’ve chosen your QR code payment solution, implement these QR code best practices to optimize this new payment method:

• Have a clear call to action (CTA). Don't leave customers guessing about how and when to pay. Whether you’re reaching shoppers on mobile, desktop, or in-store, include a clear and concise CTA next to the QR code, like "Scan for Discount" or "Shop Now."

• Use direct linking. Ensure your QR code links directly to the relevant product page, shopping cart, or promotional offer. Avoid linking to generic websites or landing pages that require additional navigation. This way, customers can easily move through the funnel and complete the buying process.

• Think about size and placement. Make sure the QR code is large enough to scan easily (at least 1x1 inch) and placed prominently on packaging, receipts, or marketing materials. Consider the distance from which customers will likely scan. If it's on a poster, for instance, it might bigger than if it's on a product label.

• Be mobile-friendly. Double-check that the webpage linked to the QR code is optimized for mobile devices. Many customers may scan the code with their smartphones, so a smooth mobile experience is essential.

• Offer value. Incentivize customers to scan the code — beyond just inviting them to “Checkout Here.” For instance, you might offer discount, exclusive content, early access to a sale, or entry into a contest.

• Consider dynamic QR codes. While static QR codes link to a fixed URL, dynamic codes allow you to update the destination even after the code is printed. This offers more flexibility for future promotions or changes.

• Keep security in mind. When accepting QR code payments, use secure networks, avoiding public or unsecured Wi-Fi networks; keep your QR code payment app and any associated software up to date with the latest security patches; and ensure your QR code payment system complies with relevant data protection and privacy regulations, such as GDPR, HIPAA, or PCI DSS, depending on your industry and location.

As businesses seek new ways to improve experiences and diversify their payment methods, QR codes stand as an innovative solution. By incorporating QR codes into their online and in-person buyer journeys, businesses can seamlessly meet customers across platforms with valuable information — creating a more intuitive path to purchase.

With QR codes, you can start accepting contactless payments in just a few minutes. Learn more about how to sell with QR codes.