The parking industry generates more than $20 billion annually in revenue, and the United States has more than 105 million parking spaces along with five million parking meters. The way your clients pay for parking, and the way you serve them, has certainly gone through a significant transformation in the past decade with the rise of mobile and contactless payments, and parking apps.
Today, businesses that provide access to parking – whether at an attended lot, or through parking meters or apps – need to offer a frictionless and speedy experience to generate more demand. In this article, we’ll explore the evolution of payments in the parking industry and how new technology can bring more opportunities for parking businesses.
The Rise of Mobile Payments
With high acceleration during the pandemic, mobile payments gained popularity around the world for various industries. The ability to store credit cards in a digital wallet gained consumers’ preference for offering a seamless payment experience. Users only need to enter their payment details once and then use their phone to pay for anything each time, including parking.
Mobile payments have a number of other key benefits, as well. For one, they are more secure than traditional payment methods, as they use encryption technology to protect sensitive payment data. They are also faster and more convenient than other payment methods, as drivers can pay for parking in seconds without the need to enter a PIN or sign a receipt.
Once embraced by the parking industry, mobile payments enabled drivers to pay for parking using their smartphones. This is now drivers’ expectation. While businesses are modernizing their checkouts, the contactless experience streamlines the payment process, reducing the time clients spend searching for change or queuing at a payment machine. During the entrance or exit of an event, this is particularly important to expedite motion and avoid having customers waiting in traffic jams. For monthly or annual users, this is convenient for automatic payment. Moreover, it has provided parking lot operators with a more efficient payment system, allowing them to track and process payments more accurately.
Parking Apps
In recent years, parking apps have become increasingly popular, providing drivers with a convenient way to find and pay for parking, especially in big cities. These apps partner with parking lots to offer drivers an option to pay for the parking on the spot at the meter, or offer discounts in times of lower occupancy to allow users to plan ahead for parking. For the parking reservation functionality, once the reservation is confirmed, the customer is provided with a QR code or barcode that can be scanned at the parking entrance. These apps provide embedded financial information for payments by storing credit card information so that the transaction will be processed through the app, and the parking operator will receive the payment.
While parking apps offer a range of features that enhance the parking experience for drivers, they also provide a profitable solution for operators. For example, by securing advance parking reservations, they allow parking lots to fill more parking spots during less busy times, when customers might have otherwise chosen to park at a competitor while searching for parking on the spot. They also provide real-time information on parking availability and prices, helping drivers make informed decisions about where to park, which means that a discounted rate may bring in more business.
By embracing innovative payment solutions and emerging technology such as parking apps, parking lot operators can ensure they offer parking spots on certain days, times or seasons that serve their schedule. This maximizes the footprint utilization and revenue potential.
The Importance of a Payments Partner
The evolution of payments in the parking space has transformed the way customers want to pay for parking, offering drivers a more convenient and seamless payment experience, but also giving parking operators the option to offer convenient payment methods and embrace inbound traffic. Businesses that provide access to parking can improve their efficiency by partnering with a payments provider that offers insight into the POS and tech that works best for the business model, broadening payment acceptance to include the right mix of solutions.
In today’s fast-paced cities, offering a premium customer experience is crucial for businesses to maximize all ways to generate demand. Parking lots are no exception, as the businesses that operate them need to process payments and make the most of their footprint. As the parking industry continues to evolve, it is clear that the future of parking payments will be shaped by technological advancements, and those that embrace these changes will be well positioned to thrive in the years to come.
Afshin Yazdian is the President of Merchant Solutions at Paysafe, bringing decades of leadership experience in payments solutions for merchants and partners across the world. He can be reached at afshin.yazdian@paysafe.com
