Mobile Commerce

‘Twas The Night Before Mobile Payments

‘Twas the week of mobile payments news. 

And all through the (industry) house,

Big companies had news to share – but few were quiet as a mouse.

The mobile pay players were stirring (and so were the payment networks and issuers).

In the hopes that NFC-enabled payments would soon be at point of sale!

2015 is the year that many players — new and old — made their mobile payments aspirations known. That means that 2016 will be the year that we’ll see the fruits of their labor take shape. Walmart, MasterCard, Apple, Google and Samsung all made news this week that may foreshadow what’s to come in the year ahead.

To get a better perspective of what’s to come, here’s the latest news that happened this week, including the newest Pay player on the retail market that’s vying for a piece of the mobile payments pie against the three big tech giants.

Can Walmart Pay Ignite The Mobile Pay Field?

Every payment player is after one outcome: grab enough consumers so that they can get enough merchants to ignite their mobile payments scheme.

Walmart’s announcement this week to launch its own proprietary payments platform, Walmart Pay, may not have been a total shock to many in the payments space, but how it decided to enter the market sure was.

Walmart is leveraging the app and QR codes to enable mobile payments for anyone with any sort of phone at any one of their 5k merchant locations in the U.S.

The ultimate goal, of course, is making sure that (a) Walmart makes sales by (b) staying in step with how consumers use their phones to shop.Mobile, in 2015 in particular, has been a bright spot in an otherwise tough year for sales for Walmart, whose seen its sales drop – and its stock drop too, deeply, for the first in 27 years. Walmart has 22 million customers who actively use the mobile app at its stores every month. Those are the consumers they feel they can get on board with Walmart Pay without having to do much more than extend app functionality to include payment.

“This is about a laser focus on the customer, it really is,” Eckert told MPD CEO Karen Webster in an interview. “We really have taken a lot of the things we see [in mobile payments] as being limiting and full of friction and really began with asking different questions. We decided to stop trying to improve payment for payments’ sake and instead use mobile to improve checkout and shopping.”

Regardless of what’s next for Walmart Pay, it has thrown a bit of a twist into the foregone conclusion that mobile payments at the point of sale are operating system/handset specific, payments type specific, and/or tied to NFC technology.

Thanks to Walmart, the mobile payments race, far from being decided in 2015, might have just gotten really, really interesting right at the end.

Android Pay’s In-App Payments Boost

Google’s Android Pay can now be used for in-app payments of several Android apps in the U.S. According to Google, Android Pay is already accepted at more than 1 million locations throughout the U.S., and the company has big plans to continue the global expansion of the payment method.

“Since our launch this fall, we’ve seen millions of people set up Android Pay, and the vast majority of them are using tap-and-pay with their Android devices for the first time,” Pali Bhat, Android Pay’s director of product management, said in a blog post on Tuesday (Dec. 15).

“Now, we’re ready for the next step: We’re working to bring Android Pay’s simplicity and security to purchases within apps and to people in more countries around the world,” the post continued.

Bhat confirmed that Android Pay will launch in Australia during the first half of 2016, with an expectation that more countries will be added throughout the coming year.

Android Pay is compatible with all NFC (or HCE) enabled devices using any OS released since KitKat. Google officials confirmed for PYMNTS that Android Pay is compatible with roughly 70 percent of the Android phones currently in the U.S.

Aussie Banks Say ‘Yes’ To Android, But Still ‘No’ To Apple Pay

In Australia, not all mobile payments apps are created equal.

While major Australian banks have agreed to embrace Android Pay, Apple Pay is still left sitting on the sidelines.  This, of course, is because Apple hasn’t agreed to the banks’ terms and there’s no indication that Apple has budged on what it wants from the banks. Banks aren’t necessarily on board with Apple Pay because of the fees associated with transactions. Negotiations have reportedly been going on since. Plus, at the moment, there hasn’t been a lot of financial perks (or perhaps consumer demand) motivating them to support the service.

What Apple wants, according to unnamed sources speaking to Reuters, is 15 basis points in interchange fees. But Aussie banks haven’t agreed. Meanwhile, U.S. banks that support Apple Pay have agreed, as have some in the U.K. and Canada.

“It’s a big bargaining chip for [Australian] banks to use to force a better deal with Apple,” Foad Fadaghi, managing director of technology research firm Telsyte, told Reuters.

The only luck Apple has had in the country is with American Express, which means Apple Pay’s launch into Australia was an extremely limited one, as those looking to use the service can only do so using American Express. And they can only use American Express cards issued by Amex itself, not from banks. That was last month, and it doesn’t appear progress has happened since.

It appears Apple is missing out on a big market, as ANZ Banking Group released a statement saying that more than 60 percent of card transactions in Australia are now contactless. That leaves a big potential for the contactless mobile payment market to be part of. 

Samsung Bulks Up Its Issuer List

The number of FIs that have tossed their support behind Samsung Pay grew a little bit bigger this week.

Samsung announced this week that it added 19 new issuers, which helps expand support for PNC Visa credit and debit cards and also KeyBank MasterCard credit and debit cards. In terms of the roster of new names, the company said that those supported include: TCF Bank, Central Florida Educators Federal Credit Union, Financial Center Federal Credit Union, Greater Kinston Federal Credit Union, Numerica Credit Union, Utah Community Credit Union, Keypoint Credit Union, California Bank and Trust and Pentagon Federal Credit Union, along with Amegy Bank National Association.

In reference to additional MasterCard issuers, the company now supports: Achieva Credit Union, Associated Bank, Bayport Credit Union, Bethpage Federal Credit Union, Cambridge Savings Bank, USC Credit Union and Navy Federal Credit Union.

“More Samsung users will be able to use Samsung Pay to shop this holiday season, thanks to new support from MasterCard and Visa issuers, including our valued partners at PNC Bank and KeyBank. With the widest acceptance of any mobile payment service, Samsung Pay continues to expand its reach and provide its customers unparalleled choice, flexibility and access,” said Injong Rhee, Executive VP of Samsung Electronics and head of Samsung Pay.

MasterPass Moves Into Online Grocery

MasterCard made another move in the digital and mobile payments space this week. Through a new partnership with FreshDirect, customers will now have the ability to utilize MasterCard’s digital payments platform, MasterPass, during the online and in-app payment process.

“FreshDirect’s promise to perfect the shop-and-deliver experience for its customers aligns with MasterCard’s commitment to ensure a seamless and secure checkout process,” Michael Cyr, group executive of U.S. market development for MasterCard, said in a press release. “With MasterPass, consumers can go online, place their order and pay with just a click. The burden of entering delivery and billing information is eliminated, further enhancing the quality service FreshDirect provides.”

Google Wallet Goes iOS And Upgrades P2P

Google has expanded the functionality of its mobile payment system. And it’s all about P2P and crossing platforms.

The company announced an update to Google Wallet that will enable users to send money by using just a phone number. With the latest version of the app, funds can be sent directly to a mobile device with a secure link via text message. The recipient can then use the link to enter their debit card information in order to claim the money, which will be available in their selected bank account in minutes, according to Google.

The Google Wallet app, which will soon be available in Apple’s App Store, has also seen recent updates in the form of security enhancements and visual improvements. The most recent version of the app includes enhanced contact suggestions, which puts the people that money is frequently sent to at the top of the list. Users are also able to lock the Google Wallet with the tap of a button. Lastly, users will be able to link a second bank account to the contactless payment system.



The PYMNTS Cross-Border Merchant Friction Index analyzes the key friction points experienced by consumers browsing, shopping and paying for purchases on international eCommerce sites. PYMNTS examined the checkout processes of 266 B2B and B2C eCommerce sites across 12 industries and operating from locations across Europe and the United States to provide a comprehensive overview of their checkout offerings.