Adoption of mobile payments has been anything but explosive. Sure, there has been a steady increase in the use of platforms like Apple Pay and Android Pay, but the reality is adoption levels — especially in the U.S. — aren’t near where some may like them to be.
According to data from PYMNTS and InfoScout, as of June 2016, more than a third of survey respondents said they rarely consider using Apple Pay. Only about a fifth said they use it every chance they get — fewer respondents than October 2015, when 35 percent of them said the same.
Meanwhile, fewer than 10 percent of survey respondents in an even more recent poll by PYMNTS and InfoScout said they’ve tried Android Pay.
So when consumers are cautiously embracing mobile payments, it’s no wonder that corporate payers are even slower at taking up the technology. Still, adoption is slowly but surely on the rise, with businesses beginning to consider using the technology for their own payment needs, too.
According to U.S. Bank’s President of Corporate Payment Systems Jeff Jones, corporates want to give mobile payments a try.
“When you look at Apple Pay made available to consumers and the convenience and security it provides consumers, I think increasingly we’ve seen an interest from corporate clients in terms of having similar types of ability to use Apple Pay,” he recently told PYMNTS.
The bank announced earlier this week that some of its commercial cards are now compatible with Apple Pay, Android Pay and Samsung Pay. This isn’t the first time U.S. Bank has lent support for mobile B2B payments. Last year the bank revealed that all of its small business card products were now compatible with Apple Pay.
They’re not the first bank to do this, either: American Express became the first major card issuer in the U.S. to link its commercial cards with Apple Pay in 2015.
U.S. Bank will target the corporate travel segment first with the move, enabling its Visa business travel cards to be used with these mobile payment platforms.
Targeting business travelers first is an obvious strategy as many of these employees may have tried using Apple Pay or the like in their own personal lives.
“Early adopters from a business travel perspective will be the people like me, the earlier adopters from a consumer card perspective,” Jones explained. “Once you have actually done it and you see how easy it is to load your card onto your device and how easy it is to transact, then the pace [of adoption] will pick up, definitely.”
While he said he predicts adoption patterns in the corporate world to be similar to those seen among consumers, the same barriers to that adoption may also be mirrored between consumers and corporate payers. Initial barriers to mobile payment adoption by corporates, he said, are likely to be around simply understanding the technology and the added security it provides — tokenizing card numbers — that can be critical for corporates.
These initial hurdles of having businesses understand why a mobile payment may not only be easier to conduct, but more secure, will be key to further adoption of the technology by businesses, he added. Jones said he envisions platforms like Apple Pay as having potential to take off in other areas of B2B payments, like procurement.
“As we see more and more merchants adopting the capability to accept Apple Pay both at the point of sale as well as online, that creates an opportunity to enable the purchasing card with Apple Pay,” he said. “It would allow someone who is not at their desk, who is traveling, who wants to use their mobile device, to purchase miscellaneous supplies from an Apple Pay–enabled online vendor.”
Corporate use of p-cards on a mobile device will similarly depend on online sellers’ ability to offer Apple Pay and other similar platforms as a payment option. As that offering rate increases, Jones said these mobile payment technologies could also one day be used for larger purchases like supplier payments.
“I do think there is an opportunity for supplier payments to be made in this manner,” he stated. “A purchasing card in many cases, in this day and age, is used for supplier payments. So as we head down this path, more and more merchants that enable Android Pay or Apple Pay capabilities will start to blaze the trail for other types of B2B payments to be paid in a similar manner.”
This adoption curve is guiding U.S. Bank’s own plans to get corporates to use these platforms. While the bank will first land its business travel card products (making it the first to enable Visa commercial cards for these mobile payment platforms, it said), U.S. Bank noted that it will eventually pull more of its commercial card offerings onto Apple Pay and other mobile payment services.
According to Jones, U.S. Bank holds confidence not only in the future of mobile payments, but in corporates’ ability to adopt the technology as well.
“We see a lot more interest in mobile capabilities,” he explained. “With this type of corporate mobile solution, you definitely see there’s a little bit of a learning curve. The adoption process, it’s not explosive. But we’re seeing more and more interest.”