From restaurant menus to the Olympics, QR codes are showing up everywhere. The handy "quick response" barcodes can pull up a menu, a payment system, or any number of websites and widgets on your smartphone. While they've been around since 1994, the pandemic prompted more businesses to adopt QR codes -- first as a safety precaution but now in other ways, such as for personalizing orders or tracking customer information. 

But as with any new advancement in technology, QR codes come with some downsides. Here's what you need to know if you use the barcodes in your business: 

1. Customers may have privacy concerns.

QR codes don't only allow you to save paper, they also let you tap into additional tools for tracking and analytics. Some businesses, for instance, have used QR codes to build a database of customer order histories and contact information, the New York Times reported recently. A QR code also allows business owners to see the timing, location, and frequency of each scan. 

While such tools may prove useful to your operations, others ought to raise questions as to whether using them is worth risking customers' privacy. More consumers in recent years are not only aware of how businesses use their personal data; they're willing to take their dollars elsewhere if they know they're being tracked. A 2019 Cisco survey found that 32 percent of consumers have switched companies over their data-sharing agreements. 

As public knowledge of the privacy risks of QR codes grows, businesses may risk alienating a growing base of more privacy-minded customers. 

2. Minimizing human contact is convenient -- but not always preferable.

While QR codes can save you labor costs by eliminating the need for additional employees to take orders or process payments, in using them your business will miss out on vital customer interactions. For example, restaurant patrons who order from a QR code menu may be less likely to ask the waiter questions or less willing to try something different. Depending on the nature of your business, what you gain in efficiency might not be enough to justify losing a cherished and useful way of interacting with your customers. 

3. Cyber criminals are figuring out new ways to commit QR code fraud.

The ability to take cashless payments is a major benefit of using QR codes. Instead of employees physically handling credit cards and payment machines, customers simply pay on their smartphone by scanning a QR code. But cyber criminals are creating fake QR codes and impersonating real businesses in order to steal funds from unwitting customers or infect their devices with malware.

Unlike phishing emails or other forms of impersonating real businesses, fake QR codes are harder to detect. A fake QR code looks pretty much the same as a real bar code. Cyber criminals can direct customers to fake payment websites by simply pasting a fake QR code over a real one.