Which payments companies have been setting off fireworks this season? Several companies have been firing off rockets — each with a little bit of a different feel to them — in a way coming together to form one great big payments fireworks show.
A great fireworks display is all about timing. You start out with some nice bright colors, but nothing too flashy, because you want to leave some room for added excitement. In the middle are your unique bursts: the cowboy hats and “weeping willows”; fireworks that really stand out to keep the show going. And then, the finale: after a little lull, everything goes off at once to really make the show pop.
In this analogy, MasterCard is an example of a company getting the show going. In May, MasterCard launched PayPass Wallet Services. The platform may not have had the sizzle of a new dongle or a QR code-based system at launch — but over the past several weeks, a series of big announcements have suggested that PayPass could become a big deal for the payments industry.
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The platform has quickly established global reach, most notably this week through a new partnership with Deutsche Telekom, which could end up reaching 93 million European consumers. And with smaller deals in countries like Russia, South Africa and Hong Kong, MasterCard has shown how PayPass could scale globally.
For the middle of the payments fireworks show — the cowboy hats and the weeping willows, so to speak — perhaps look at Square. One of the most innovative companies in payment acceptance keeps firing off major announcements, basically adding $1 billion to its annualized processing total in each of the past three months, from $4 billion in April to $6 billion in June. The company’s merchant base has passed two million, up 100 percent over six months, and a few weeks ago the platform debuted new loyalty features to attract adoption. But can Square sustain its success? It still has a long ways to go: Heartland, the fifth-largest processor in the U.S., handles $80 billion in annual transactions, for example.
The grand finale might be coming later this year, from a certain mobile device manufacturer. Yep, putting NFC into the next iteration of the iPhone would surely count as a dramatic performance — particularly when combined with Apple’s new Passbook app, which looks a lot like a digital wallet. Of course, we still don’t know if Apple will actually put near-field technology into its phones, but the rumor fire has only burned hotter lately.
Of course there are plenty of other candidates for this analogy. PayPal has certainly had a year full of fireworks, marked by huge new partnerships with VeriFone, Equinox, and a slew of retailers — plus some European innovations, including a retail venture in the U.K.
What about issuers? One of Citi’s most recent hires — adding former Motorola executive Christy Wyatt as head of e-commerce and mobile technology — suggests big moves might be on the way, while companies like U.S. Bank continue to release new products in the card space.
And then there’s the startup community, full of possibilities with new companies raising millions every day. In particular, companies like TabbedOut (raised $3.5 million on June 26) and LevelUp (raised $12 million on June 7) are having a big impact on the point of sale.
Those are some of our picks for payments companies setting off fireworks lately. Who would you put in the lineup?
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