Static vs Dynamic QR codes

Usually when I hear “static” and “dynamic”, it’s to do with rock climbing. But those terms appear in payments too, when describing QR codes. I’ve found myself explaining static vs dynamic QR codes recently, so thought to document it.

Definitions

Static QR codes are unchanging

• How it looks: A printed sticker near the cashier or at a storefront. An image saved in the phone. A QR code on a website.
• How it works: As a customer, you open your bank/mobile wallet app and scan the QR code. Fill in the amount owed to the merchant. Click “Pay”.

Static QR in the wild (in Singapore)

Dynamic QR codes change

• How it looks: Displayed on a digital device (a point of sale terminal, a tablet, a phone, a website). Looks similar to a static code, so the difference is in how it works — see the next point.
• How it works: As a customer, you open your bank/mobile wallet app and scan the QR code. Key difference: The dollar amount is pre-filled (so no manual entry is required). Click “Pay”.

Dynamic QR in the wild (in the USA)

If the country supports instant payment rails, the payment lands in the merchant’s bank account immediately (good!).

Static vs Dynamic — Pros & Cons

• Static codes are easier to set up: Static codes are the easier way to start (just print paper with a QR code and stick it up). Or use a phone to show the QR code.
• Dynamic codes might be harder to set up, but are a better user experience: Dynamic QR codes require having a POS terminal or a physical tablet + software behind it, which can be more expensive and challenging for merchants.

Below is a brief summary of pros and cons of each QR type.

Simplified overview table

Concluding thoughts

• Being tourist friendly: A downside to accepting QR payments is that it is harder for tourists who don’t have local bank apps. So for a business selling to tourists, it still makes sense to accept cards. Interestingly, governments are collaborating to make QR codes interoperable — for example Singapore (Paynow) <> Thailand (Promptpay), which means that a Thai tourist in Singapore can use their Thai bank app to scan a Singapore QR code and pay. This might be solution for common tourism corridors.
• QR codes enabling digital payments: Overall, it is great to see businesses using QR codes (static or dynamic) as an alternative to cash acceptance. [1] Especially for smaller businesses, where accepting cards can be expensive, QR codes are a cheaper foray into digital payments.

[1] Despite personally enjoying digital payments, I believe cash should be accepted for demographics that are unbanked, or uncomfortable with mobile/smartphone payments. Especially for the elderly, the lack of cash acceptance is challenging and exclusionary.