How do QR codes work?

QR codes have revolutionised how individuals interact, transact, and access information in the digital age.

This article includes tips, suggestions and general information. We recommend that you always do your own research and consider getting independent tax, financial and legal advice before making any important decision.

QR codes can be leveraged across industries and applications, from scanning menus to event ticketing.

QR codes can also be used to make payments, allowing individuals to complete transactions swiftly with a mobile device. All it takes is a scan of the code using either a QR code reader or a smartphone's camera, and a transaction can be initiated.

This guide covers the basics of QR codes, including:

• What are QR codes?
• QR code uses
• Types of QR codes
• How to use QR codes
• Potential benefits and drawbacks of QR codes for payments

What are QR codes, and what are they used for?

QR codes can be a helpful tool for connecting the physical and digital worlds.

QR stands for Quick Response code, which is a two-dimensional barcode that stores information in a compact format. Composed of black and white squares arranged in a grid, QR codes can be scanned by smartphones, tablets, or dedicated QR code readers.

Some potential QR code uses may include:

• Making payment transactions
• Storing website URLs
• Providing product information and details
• Enabling event ticketing and check-ins
• Conducting contactless mobile ordering
• Enhancing marketing campaigns
• Facilitating contact tracing

How do QR codes work?

When a QR code is created, data such as text, URLs, multimedia content, or contact details is converted into a matrix of black and white squares. To access the information, someone generally needs a smartphone or QR code reader equipped with a camera.

By scanning the QR code, the device can capture the pattern and decode the data, providing access to the relevant information or triggering a specific action, such as making a payment, visiting a website, or adding contact details. To pay with a QR code, people would typically scan the code and follow the directions on their screen.

How to use a QR code

Wondering how to scan a QR code? The process may look like this:

• Ensure the mobile device has the capability to scan QR codes or has a QR code scanning application installed.
• Either open the device’s camera app or QR scanning app and access the camera function.
• Position the device so that the QR code is within the frame of the camera.
• Maintain a steady hand and allow the camera to focus.
• The app will automatically detect and analyse the QR code.
• Once recognised, it will decode the information in the QR code.
• Depending on the content, the app may lead to an action, such as opening a webpage or displaying relevant details.

Types of QR codes

There are two main types of QR codes: static and dynamic QR codes. Each of them may serve different purposes and offer distinct features.

So what is a static vs dynamic QR code? Here’s what to know:

• Static QR codes: These QR codes are generally created with fixed information that can't be changed once generated. They are commonly used for basic applications where the encoded data remains constant over time. For example, static QR codes can be used to direct users to a specific website, share contact information, or display simple text-based content. They can be easy to generate and widely employed for marketing purposes, such as on printed materials or product packaging.
• Dynamic QR codes: Dynamic QR codes can offer versatility and flexibility as the encoded information can be modified or updated after the QR code is generated. These codes are typically used in marketing campaigns, event ticketing, product inventory management, digital menus, and payment systems. Other potential advantages include real-time data tracking, analytics, and redirecting users to different content based on the time of scan.

Potential benefits of paying with a QR code

There are potential benefits of paying with a QR code. Some of them may include:

• User-friendly solution: People can easily scan the QR code using their smartphones, eliminating the need for physical cards or cash.
• Speed and efficiency: QR code payments are typically fast and efficient, allowing for quick transactions. Scanning a QR code normally takes only a few seconds, reducing waiting times and improving payment processing speed.
• Security: QR code payments often employ security measures, including encryption and tokenisation, to safeguard financial information.

Potential cons of using QR codes to pay

Consider the potential disadvantages of QR code payments, including:

• Device and internet reliance: QR code payments generally rely on smartphones or devices with camera capabilities, which may pose a limitation for individuals without compatible technology or reliable internet connectivity.
• Potential technical failure: Technical issues, such as camera malfunctions or app crashes, can hinder the scanning process and disrupt payment transactions.
• Limited usability: QR code payments may not be universally accepted by businesses or merchants, requiring individuals to carry additional payment methods.

Explore ways to pay with QR codes using the PayPal app.