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Open & Closed Loop Payment

Open & Closed Loop Payment

In payments, both open and closed loop systems are utilised and very often compete.

Closed loop payments schemes allow users to pre-load funds onto their spending account that is linked to the payment device, which is usually a card or wearable.

Customers can re-load amounts to their account through a variety of mechanisms, such as automatic top-up’s, online access or at fixed terminals. Any funds that are not spent cannot be used outside the scheme and so must be refunded to the customer or retained within the system.

Closed loop payments are particularly popular in applications, including cashless vending, festivals, gyms and associations.

Open loop systems connect customer payment directly to a credit or debit card or wearable provided by the banks or card issuer and is subject to their terms and conditions. Payment is not restricted to a particular scheme and can be used outside of the event with any retailer that allows EMV payment.

Closed Loop Payment

Universal Smart Cards have seen a massive rise in the uptake of Smart Cards and Wearables as the security credential for cashless vending and closed-loop payments.

In a closed loop, applications can vary between 'storing value' on the smart card itself, particularly useful for off-line transactions, or using the card as a 'secure identifier' to back-end account-based systems.

In this market there are three types of cards being deployed:

Smart Contact-Chip Memory Cards – these are typically being used for stored value using a counter and are beginning to fade with the ease of contactless cards.

High Frequency (HF) Cards - are an easy-to-use, convenient technology either storing value or using the UID to link to the back-end system.

More secure Micro-controller (microprocessor) cards -  for those applications where higher security levels are needed for protecting the value being stored on the card itself.

Universal Smart Cards’ knowledge is helping vendors with these smart card technologies. We provide a complete range of cards, both contact and contactless, from our technical centre in Portsmouth.

Dedicated account managers are on hand to help with all aspects of card supply from the design concept to the finished card.

Universal Smart Cards can also help with in-house card printing, key initialisation or full personalisation and fulfilment. Recently we worked with a consultant to replace less secure memory cards, for example, with secure microprocessor cards for stored value in petroleum stations in the middle east.

Closed Loop Payment

Universal Smart Cards can help with the following applications:

Unattended vending machines - these are having a bit of a renaissance as highly attractive places to buy things quickly and easily, especially for younger consumers. We are helping customers with card technology for use in vending machines, fuel stations, leisure, gyms and sports centres.

Cashless vending - combining payment in the cafeteria or vending points within organisations along with physical and logical access control systems. We can recommend high-quality vendors that provide a full end to end solutions.

Cashless vending

University or Campus cards - allowing student access to multiple services. We work with several vendors that provide full integration of a closed-loop campus solution.

Events and festivals - please refer to our range of wearables that we can provide for these markets. Both disposable and silicon wristbands are popular items we sell to these markets. See further link here.

Open Loop Payment


Contactless payment has become the most common way for many people to conveniently pay for low-value purchases. This technology is still rapidly growing, from low-cost wristbands for events to high value fashion accessories that are now offering payment.


Consumers are now looking for the ease and convenience of paying for something using what they are wearing rather than using a card or not having one on them.

Open Loop Payment

This is giving organisations and wearable manufacturers an ideal way to promote their products and add value to their brands by being innovative and creative.

In addition to added convenience, there is an argument that this gives better security, not only at large events but in everyday shopping too. Wearing it reduces the chance of loss and it is arguably harder to steal than in your bag or pocket.

For more information on how we can support you in payment for wearables or smart objects, please see the link to our solutions page here.


Universal Smart Cards can supply a full end-to-end wearable payment solution including:

The supply of smart insert tags, inlays or labels for third-party integration into devices or brands

Manufacture of a range of OEM-PAYMENT CERTIFIED fobs, wristbands and insert tags. These can be fully branded with your artwork enabling easy deployment.

Provisioning of the device with payment details using our partnership with DIGISEQ. This means we can carry out the complex and specialised tasks of adding payment details with the relevant players in the payment ecosystem.

Fulfilment from our technical centre in Portsmouth including brand packaging and postage straight to your customer.

Website hosting. Universal Pay is an easy deployment allowing organisations and brands to quickly set up a shopping cart of wearables for easy checkout and purchase.

The supply of smart insert tags, inlays or labels
Fulfilment from our technical centre in Portsmouth
Website hosting

If you would like more information on how we can help you, please either see more information here at Universal Pay or please contact us and one of our experienced staff members will be happy to assist you.

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