International

Square Heads To The UK, Wells Fargo Hearts NFC And Ant Financial Finds Some Fighting Words

Oberthur Partners On Mobile Payment Platform

Samsung managed to take up most of the oxygen in the mobile room this week — and the big show included the world’s introduction to the new Galaxy phone, Bixby, VR, Samsung Pass, and Samsung Pay’s and Visa Checkout’s partnership to bring Samsung Pay to the online world. It was quite a big show, and we strongly suggest you read our full recap of it here.

But though Samsung was hitting grand slams this week in New York, there were still the singles and doubles across the mobile payments playing field this week. Apple and Square both set off on new international adventures, Wells Fargo embraced the NFC ATM, and Alipay’s parent company decided to offer a more direct response to Euronet’s challenge to its MoneyGram acquisition.

Lots to catch — here’s the rundown.

Apple Goes To Taiwan, Square Goes To The UK

Brexit, Schmexit. Square is making a jump across the pond to the U.K. — a reported first stop as it considers wider European expansion.

“The U.K. is really interesting in that we see a lot of card usage through tap … which is perfect for our new card reader,” Square CEO Jack Dorsey told CNBC in an interview. “There are over 5 million small businesses in the U.K., and we think less than half accept credit cards, so we think the market opportunity is huge.”

It remains unknown how many merchants are on board for Square’s test flight — but according to Dorsey, it’s “enough” in terms of numbers and diversity of industries and businesses served. He said launching in the U.K. will not increase its capital expenditures or impact its march forward to profitability.

“[Profitability is] always something we are driving toward, but we want to make sure that we have a good balance between driving profit and investing in the company. Investing in the company means investing in more technology so we can continue and innovative and bring new products and features to all of our sellers. And as we do that, we get to see more sellers, and we get a deeper relationship with sellers than we do have,” Dorsey said in the interview.

The move into the U.K. is not Square’s first move to play on the world stage — the service is already online in Canada, Japan and Australia — though the entrance into the U.K. could function as a base to expand through Europe. Could is the operative word in that sentence, of course — because Europe has its own rather established mobile point-of-sale player — most notably iZettle.

In a conversation with The Financial Times about Square’s expansion onto their turf, iZettle CEO Jacob De Geer didn’t seem overly concerned.

“Square has been in the U.S. market for a while, and we’d heard they were about to launch in Europe for at least four years, so it’s about time,” said De Geer.

“We’re by far the biggest player in the U.K., having been in the market for almost five years, so we’ve got a head start.”

But then, Jack Dorsey is a pretty confident guy, too — and he thinks Square can compete on services with whatever the market already offers with things the European market lacks.

“Square is fast to set up, really fast to get your money as a merchant — the next working day, which no one else does — it’s intuitive and really fast processing,” he said. “The industry average to process chip cards is 11 seconds, and we got ours down to 3.6 seconds.”

Should be an interesting race.

Speaking of racing and international expansion …

Apple Pay Moves Into Taiwan

It looks like after all the months of waiting, Apple Pay will be rolling out in Taiwan for customers with the right devices. According to reports in The China Post, Apple’s mobile payment platform rollout is already under way. On Apple’s Taiwan website, the Apple Pay information page is already up and running.

Supporting Apple Pay at launch in Taiwan will be Visa and Mastercard with support from seven Taiwanese banks: Taishin International Bank, Taipei Fubon Bank, Standard Chartered Bank, Cathay United Bank, CTBC Bank, E.SUN Bank and Union Bank of Taiwan.

Retail support for the mobile payment services will be limited in Taiwan to business that have NFC terminals — as is the case everywhere else on earth. Locations within Taiwan will include  the Breeze Center, Far Eastern Department Stores, Sogo, Carrefour and PXMart. Apple Pay will be supported at FamilyMarts throughout Taiwan, though only for users of Taishin International Bank cards.

The forthcoming launch of the mobile payments service first started making the rounds in media in September  but no progress was announced after that initial run of rumors.

Taiwan marks the fourteenth country in which Apple Pay has launched. Most recently, the mobile payment platform came to Ireland earlier this month.

Wells Fargo Embraces NFC

Wells Fargo is giving its customers something this week — and this time it isn’t a bank account or a credit card they didn’t actually ask for.

Nope — Wells Fargo has embraced NFC technology for its ATMs that allows smartphone-armed customers to withdraw money at all of its 13,000 ATMs without inserting their debit card.

To access the service, customers need to grab a one-use-only eight-digit code from the bank’s phone app. Customers then input the code and their ATM PIN number to access ATM options.

This move precedes a planned rollout for later this year that will add a “tap and pay” ATM access service that leverages NFC and will allow customers to access their accounts via the Wells Fargo Wallet, Apple Pay, Android Pay or Samsung Pay — about 40 percent of Wells Fargo’s ATMs are NFC-enabled.

“We believe the future is cardless,” said Brett Pitts, the company’s head of digital for virtual channels.

Alipay’s Pointed Response To MoneyGram

It was surprising in January when Ant Financial, parent company to Alipay, announced it planned to acquired American money transfer business MoneyGram for $880 billion. It was even more surprising when U.S.-based Euronet announced its intention to bust up that deal with a counteroffer of $1.3 billion.

Also rather eye-catching is Euronet’s rather aggressive pursuit of the deal.

According to reports out this week, Euronet has urged the U.S. government to take a closer look at the competing bid from Ant Financial, a company based in China, stating that it raises “significant national security risks.”

Euronet Chief Executive Officer Michael Brown penned a letter to Treasury Secretary Steven Mnuchin on Monday (March 27), explaining that whoever takes over the global money remittance company will be requested to help authorities combat money laundering and terrorism financially by complying with often confidential data requests.

“A money transfer company’s ownership and leadership at the top are critical in ensuring that all of these responsibilities are carried out fully and effectively,” Brown stated in the letter, which was reviewed by Reuters.

“We feel … there are significant national security risks that merit careful evaluation for any foreign buyer of a company in this industry,” he said.

Euronet maintains that an all-American deal would face significantly less regulatory scrutiny than the sale to a foreign entity that would result if the Ant Financial deal goes through.

Ant Financial, unsurprisingly, had a response to offer — which it sent to PYMNTS. First, it affirmed its commitment to working with law enforcement around the world.

“Ant Financial volunteered and sought the CFIUS [Committee on Foreign Investment in the United States] review of our proposed combination with MoneyGram and is steadfast in our commitment to protecting data of U.S. consumers — as we currently do for more than 630 million users worldwide — as well as working with law enforcement in the U.S. and anywhere we operate to fight illicit financing,” the company stated.

It also threw some shade on Euronet’s tactics in pursuing this deal.

“If Euronet truly believed that the Ant/MoneyGram regulatory approvals were a significant hurdle, it would not have submitted a higher bid for MoneyGram prior to the CFIUS review of our transaction. Euronet’s conduct — including writing a misleading and self-serving letter to the Treasury Department — raises serious questions about Euronet’s true motives. Ant is the only partner committed to creating American jobs by growing MoneyGram’s business and operations in the U.S. in a safe and secure way, rather than eliminating jobs in the U.S., as is inevitable with Euronet’s proposal for MoneyGram,” the response stated.

Oh, and Ant Financial isn’t going anywhere.

“Ant will continue working with regulators to successfully close this transaction later this year.”

Doesn’t look like a nice, clean fight is in anyone’s future here.

So the lesson of the week in mobile payments, it seems, is keep an eye on the globe. It’s a big world, but the players are sure trying to make it smaller (and a bit more NFC-enabled.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out the February 2019 PYMNTS Financial Invisibles Report

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