Everybody is talking about mobile payments.
Banks around the world are trialing and launching new platforms, the OEMs are rolling out country-by-country and battling for market share and, crucially, consumers are responding. Juniper Research predicts that mobile and contactless payments will hit $3.6 trillion dollars this year alone so the future of mobile money looks very strong indeed.
1. Starbucks (@Starbucks): Loyalty & Payments in Advance
Starbucks has always been ahead of the curve. It offered in-store WiFi as early as 2001 and was an early adopter of mobile payments since 2009. Because of innovations like this, the coffee giant has not only managed to plant a store on tens of thousands of street corners around the world, it has also (I would argue) achieved one of the biggest mobile payments success stories to date. Mobile transactions count for around 25% of all in store sales and they have achieved this by offering consumers convenience and value by allowing them to order in advance, make easy payments and receive automatic loyalty and rewards. All of this has incentivized app use, reduced queueing time and driven footfall and revenues.
2. Royal Bank of Canada (@RBC): Gift Cards & Digital Receipts
RBC – Canada’s largest card issuer with 6.5 million cards – is a bank known for pushing the boundaries and Canada has been extremely receptive. Firstly, its app is based on host card emulation meaning customers don’t need a particular SIM card. Its latest wallet development lets its customers pay in-store with credit debit and, notably, gift cards in addition to receiving digital receipts. This is a great example of using added value to drive adoption. Users can add existing gift cards, purchase new ones from the app from over 150 loyalty programs and send cards to friends. This is one more step along the road to making the stack of plastic in your pocket defunct.
3. M-Pesa: Reaching the Unbanked
I could not write this blog without mentioning M-Pesa, the money transfer, financing and micro-financing service that was launched in 2007 and which has seen impressive adoption in Kenya, Tanzania, Afghanistan, South Africa, India and Europe. While slightly different to the other apps mentioned, as it works on a remote payments infrastructure, its impact is arguably much greater. Taking Kenya as an example, it is now used by over 17m Kenyans – equivalent to more than two-thirds of the adult population – and around 25% of the country’s gross national product flows through it. It has flourished for a number of reasons, including the high cost of sending money via other methods and mistrust in the banking infrastructures in developing countries.
4. ANZ Bank (@ANZ_AU): Select How to Pay
One bank really making some noise around mobile contactless payments at the moment is ANZ Australia. Interestingly, the app offers customers a number of ways to initiate a payment to tie in with how they like to use their device. Users can opt to either wake their device before a payment can be made, launch the app or require a passcode to be entered. This enables you to select the level of convenience you require.
CaixaBank have a reputation for innovation and with Spain being a big market for contactless payments, it was only a matter of time until it made waves in mobile. In 2015 it launched a host card emulation (HCE)-based mobile payments applications and in January 2016 announced ImaginBank, its mobile-only bank offering ImaginPay, a payments app which supports near field communication (NFC) smartphones, wristbands and wearables. Do you think this is the future of banking?
6. Capital One (@CapitalOne): Security Through Tokenization
Late last year, Capital One became the first US bank to enable NFC payments within its own mobile app. As we are seeing in many implementations now, Capital chose to also integrate tokenization into its app, replacing consumers’ sensitive data with random values to protect against hacking.