Tag: contactless payments

The newly released mobile wallet from Apple is already being shut down by the competition.

According to The New York Times, Rite Aide and CVS Health, two prominent retailers in America, stopped Apple Pay from working in their stores across the country over this past weekend, and although the decision may not make sense in terms of ensuring customer satisfaction, as a business decision it makes more sense considering these retailers and others are planning to implement a mobile payments system that will compete with Apple’s.

A group of retailers are currently working on a mobile payments system called CurrentC

Although CVS did not comment on the decision, A Rite Aid spokesperson, Ashley Flower, said that Rite Aid “does not currently accept Apple Pay,” and that the company was “still in the process of evaluating [its] mobile payment options.”

Furthermore, while Apple also declined to comment on the recent actions taken by the retailers, the chief emerging payments officer at MasterCard, Ed McLaughlin, said that MasterCard believes customers should be able to pay using any method they want and that Rite Aid and CVS made the wrong choice. The well-known credit card company has teamed with Apple on the new system.

However, while the move made by many retailers across the US to disable Apple’s contactless payments has come as a surprise to many, analysts say that disabling Apple Pay could have been a decision that was made to benefit a rival m-payments system known as CurrentC, which is currently being developed by Merchant Customer Exchange (MCX), a consortium of merchants, which include CVS, Rite Aid, Gap Inc., Walmart, and Best Buy, among others.

Many believe that Apple Pay will give CurrentC a run for its money.

CurrentC, which is set to be released in 2015, will be connected to the debit account of consumer’s who uses it via an app that users download. This means the payments system would bypass credit card companies, which could mean that merchants might potentially save money on how much they pay in fees for every transaction. To make a purchase, the merchant has to scan a QR code, which initiates the transaction.

Apple Pay, on the other hand, only works with the company’s newly released iPhone 6 devices and it basically supplants tradition credit cards, giving consumers the power to pay for their merchandise with a wave of their smartphone using NFC (near field communication) technology. Presently, over 220,000 retailers are equipped with this technology.

The New York Times reported that those who are opposed to CurrentC say that the system will be harder to use than Apple Pay, as it will require customers to unlock phones or open an app, which is more complex than simply paying with a credit card or cash. McLaughlin believes Apple will win in the end because its payment system “is the most convenient, most secure, and what’s best for consumers.”

The Australian banking industry has increased its efforts to offer consumers new mobile payments technology.

Throughout the past year, Australia’s major banks have become more and more invested in mobile payments that utilize NFC technology and all if the “Big Four” – Westpac, CBA, ANZ and NAB – now have contactless cards available for their customers.

Over a 12 to 18 month period, contactless payments soared from 10% to 60%, according to Westpac.

The Australian bank also predicted that three million people will make approximately five contactless mobile payments, on average, each month in 2015, which will result in a $3 billion industry.

Mobile payment solutions embedded with near field communication (NFC) technology are believed to be the tech that is the most probable to advance mobile proximity commerce in the years to come. Moreover, with the country’s chief banks getting involved, there has been an increase in consumers adopting NFC services.

NFC solutions, such as Commonwealth Bank’s CommBank app, which enables users to “Tap and Pay” with their smartphone, offer consumers all of the advantages of contactless cards like ease of use, convenience, security and fast payment. What’s more, however, they make a user’s mobile device even more practical for day-to-day use.

For instance, Commonwealth Bank customers have the ability to withdraw cash from ATMs without having to use a card. All they need to do is login to the financial institution’s mobile app and choose the desired amount they want to withdraw. They will then be provided with a code that they enter into the ATM and a PIN that is texted to their mobile.

Even wearable technology is being used. Recently, St. George became the first bank in Australia to release a banking app created for smartwatches. All of these different trials from the banks are the innovative ways that these institutions are attempting to make it more convenient for consumers to go about their daily lives without having to worry about using cash or plastic cards.

Security will play a significant role in the adoption of NFC technology.

Security is the heart of every payments platform. For this reason, consumer trust is essential in order for a payment method to do well and survive. In a newly conducted survey by RFi Consulting, 55% of survey respondents cited security as one of the three main factors that affect how they choose to pay for merchandise. Thus, it should come as no surprise that security has been a top priority for banks in the creation of their latest mobile payment technologies. If a phone equipped with NFC technology was stolen or lost, for example, the consumer is safeguarded from fraudulent account activity in the same way they would be with a credit or debit card.