Visa Crowns Slovakia As Model Market For Contactless Payments

The mobile payments space in Europe is one that is quite intricate due to its fragmented nature. The 28-nation union includes a myriad of mobile network operators and banks, and must deal with regulations that make it difficult for products or services to find common ground.

But in the midst of this tumultuous landscape, there is one country that has managed to find consistency. In the UK, like several other European nations, mobile companies and banks have yet to develop partnership services and contactless technology isn’t taking off in ways some had hoped.

However this isn’t the case in Slovakia, where Tatra Banka and O2 have joined forces to introduce the commercial launch of mobile contactless payments. As reported in Retail Week, Visa Europe recently hailed Slovakia as the model market for the adoption of contactless technology and mobile payments. Visa attributed the country’s ability to stabilize its contactless market to Tatra Bank’s initiative.

What did Slovakia do differently that many European countries have yet to master?

“Slovaks like innovations. Since we introduced contactless payment cards in 2010 its use has grown rapidly. And nowadays our clients pay contactless with pleasure using their mobile phone,” explained Michal Liday, a board member at Tatra Banka, as reported by Finextra.

There are over one million contactless payments made in Bratislava, the capital of Slovakia. Retail Week reported that 36 percent of the city’s payment terminals are contactless. In 2012, contactless accounted for €16 million in payments, compared to its 2011 report, which indicated only €3.3 million in payments came from contactless. The head of retail at Tatra Bank, Lucia Sudova, noted the statistics, and agreed that the country’s success is largely a credit to residents’ eagerness to try new technologies. 

At present, most contactless payments made in Slovakia are made by card. Tatra Bank told Retail Week that there were only a couple thousand of consumers reported to be making mobile payments. The bank revealed that it expects other mobile networks and banks will follow its path and begin partnering. After more services are offered, mobile payments will be better equipped to reach its tipping point and become more widespread.

“We wanted to innovate and show the market mobile payments are here,” Sudova said. “Now we need our competitors to come so the market can develop and customers can adapt more easily.”

It is evident that partnership is key for the future growth of contactless and mobile payment adoption. Mobile operators and banks are unable to develop these services independently and need to join together before finding solutions.

To read the full article at Retail Week click here, or at Finextra click here.