MasterCard’s King says Cash is not….

Marion King, MasterCard’s president for the UK and Ireland spoke to Marketing Week recently about the possibility of a cashless society. She stated that the emergence of innovative payments technologies will eventually replace cash.  “There are different levels of take-up across the globe but I think that cash will increasingly be replaced, largely because of technological innovations and digital currencies via the smartphone.”, she said. She argued that, despite a global economic crisis, there is a steady rise in MasterCard’s volume of transactions, offline and online which she sees as a true indicator of a move away from cash.

She underlined MasterCard’s confidence in mobile payments, emphasising the number of investments made in this payment method. MasterCard’s partnership with EE to launch iZettle in the UK marks the shift to cashless payments for small retailers, KIng explained, “Where historically it has been costly and prohibitive for these retailers to accept cards, this innovation allows them to accept card payment wherever they are by plugging in a dongle into their smartphone.”

Security is evoked as one of the many benefits of the change towards cashless payment, but data seems to be a key advantage of the move away from cash. “Card transactions provide data, and we are able to use that to help merchants and organisations plan and understand buying patterns, and whether customers are moving more towards e-commerce and if so under what circumstances. If a customer uses cash, there isn’t that data.”, Marion King said.

The MasterCard president added the important role of the ease of use in the spread of card and mobile payments and urges small retailers who have taken a cash-only approach in the past to consider the new option to boost their business.

It looks though, yet again, that reports of cash’s death have been greatly exaggerated as for the foreseeable future at least, cash remains the favoured means of payment particularly  for lower value transaction. Added to this is the fact that, consumers prefer the anonymity conferred by cash and there will always be a sector of the population who remain resentful of  the data crunching retailers that follow purchasing behaviour.

From a retailer perspective, particularly, the smaller ones, they struggle with the higher transaction fees (sometimes passed onto the consumer).

For the latest jobs in the card and payment industry, go to http://www.cardandpaymentjobs.com

 

 

Contactless Cards and Payments Conference - June 20th and 21st - London

Following on from the success of the 2011 conference, Contactless Cards & Payments is returning to London for it’s 10th annual conference on 20th & 21st June 2012.

A new report by Forrester suggested Britain will be a cashless society by 2016.

Contactless Cards and Payments 2012 covers a variety of technologies, from NFC to mobile payments and banking. This conference is an update on the newest technologies to be developed, case studies of successful schemes and a look at the risks involved from a fraud perspective. With developing technologies comes new regulation, and this event will also look at the regulatory bodies and how they are approaching the potential risks and prevention strategies they intend to apply.

With the conference taking place a month before the London 2012 Olympics – this is a good opportunity to gain an insight into the role contactless cards play in major events. As the leading banks have a big role in contactless, the question most people are asking is what role the big technology leaders such as Apple and Google will play in securing their position in this rapidly growing market.
Although a tremendous amount has been achieved in contactless cards, the question still remains as to why there is a slow response and attitude from consumers towards this ever evolving concept.

SMi's two day conference has been carefully designed to bring you 18 successful case studies and interactive panel discussions, this is the only event that will give you answers and experiences you need to gain a better insight into the contactless cards market.

Key topics to be discussed:

NFC: recent developments in mobile payments

E-wallets: are we ready for a cashless society?

The European market: hear from leaders in the Turkish and Spanish markets

Retail: hear from leading retailers including stadiums and vending machines

Apple and Google: what will they do?

Keynote speakers include: 

Juan MorlaCards Director
La Caixa Bank (Spain)

Burak IlgiciogluCards & Payments Systems Analysis ManagerYapi Kredi Bank (Turkey)

Craig RamsayGlobal Innovation
Barclaycard

Carl Scheible Managing DirectorPayPal

Kevin LomaxHead, Collections Cash Management
Standard Bank

Victor DostovPresident
Russian Electronic Money Association

Mehmet SezginCEO Payment Systems Garanti Bank

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The expert speaker line-up also includes

Burak Ilgicioglu, Cards & Payments Systems Analysis Manager, Yapi Kredi BankCraig Ramsay, Global Innovations, Barclaycard
Sergio Cozzolino, Strategic Development Director, Telecom Italia Mobile
Matthew Hudson, Head of Business Development, Transport for London
Carl-Olav Scheible, Managing Director, PayPal
Kevin Lomax, Head, Collections Cash Management, Standard Bank
Victor Dostov, President, Russian Electronic Money Association
Mehmet Sezgin, CEO, Payment Systems, Garanti Bank
Juan Morla, Cards Director, La Caixa (Spain)
Karen Walsh, Business Development Director, Everything Everywhere
Gerhard Romen, Director Financial Services, Nokia
Claire Maslen, Senior Manager, Market Development, 02
Robert Courtneidge, Global Head of Card & Payments, Salans Solicitors
Dave Birch, Director, Consult Hyperion
Saadi Hussain, Head of Commercial Management, BT
Chris Crooks, Managing Partner, Optimum Associates
Francesco Burelli, Partner, Value Partners

Go to http://www.smi-online.co.uk/events/overview.asp?is=8&ref=3720 and book your ticket now

Facebook rolls out mobile billing system

Facebook has moved to simplify the way developers charge for their mobile Web apps with the launch of a direct-to-carrier billing system.

 

The new process, outlined on Facebook's developer blog, requires users to take two steps to make a payment - compared to seven, including SMS verification, for the old system.
Users who want to pay for a virtual or digital good in a mobile Web app just open the payment dialogue and confirm their purchase.

The new system comes after the social network inked a deal with UK-based mobile billing and analytics firm Bango.
Initially unveiled at Mobile World Congress in February, the service has now gone live with US and UK giants including AT&T, Sprint, Vodafone and O2, with operators in more than 60 countries set to follow.
Facebook is keen to find ways to make money from the increasingly important mobile arena, admitting in filings ahead of its recent IPO that the shift to handsets is hitting advertising revenue.
To find jobs in the card and payment industry, go to http://www.cardandpaymentjobs.com

Wake me up before you Mo Co! - Mobile payments exceed cheques

If, like me, you are a long way off from thinking that Mobile Commerce is a mainstream payment method, then thonk again, because a  recent study undertaken by ACI Worldwide and Aite Group – where smartphone usage in 14 countries was put under a microscope – shows that mainstream Mobile payments are already here (more prevalent in some markets than others of course!!).

The study identified a group of consumers where mobile payments behaviour is the norm and this group was classified as “Smartphonatics”.

According to this research, 80 percent of Smartphonatics have used their smartphones for mobile banking, just one-third of non-Smartphonatics report doing so. 70 percent of Smartphonatics have used their smartphones for mobile payments; under 25 percent of non-Smartphonatics have. Smartphonatics are generally younger consumers also: 36 percent of Generation Yers (between the ages of 20 and 31) are Smartphonatics as are nearly one-third of Generation  Xers (ages 32-46). The number drops significantly among both Baby Boomers (ages 47-65) at 18 percent and Seniors (66+) at six percent

Ron Shevlin, Senior Analyst, Aite Group states: “Smartphonatics enthusiastically use their smartphones when they shop for products and services as well as when they interact with their banks. It is quite clear they are an emerging consumer force. Smartphonatics are driving the adoption of mobile banking and payments and will be an agent for change. Financial and retail institutions will need to adapt or risk being left behind."

The ACI/Aite research indicates that around 1 in 4 consumers globally count as Smartphonatics, with higher numbers found in India and China than in the United States and Europe. This follows through as markets such as India and China have mobile payments competing head to head in the growth of other payment methods such as cards, which are still relatively new for the majority of the population.

In Asia, however, mobile payments have been mainstream for the best part of a decade. Japan sets the benchmark for mobile payments with 47 million Japanese adopting tap-and-go phones. In 2013, China alone, will have 169 million users of tap-and-go payments. Between 500 million and 1 billion people will access financial services by mobile by 2015, depending on various estimates. The mobile financial services market will be dominated by Asia, driven by mobile operator-led initiatives in developing markets to bank the unbanked. Remittance and transfers by mobile is growing three times faster than mobile banking. Mobile remittances are a form of mobile payments, essentially mobile-led P2P.

MasterCard’s study of Mobile Payment readiness which we commented on last week, revealed that whilst the USA is ‘mobile ready’, 9 of the 10 countries most prepared for the technology are in Africa, the Middle East and Asia.

So, if Mobile Payments are indeed exceeding cheques, what in fact constitutes a Mobile Payment? The seven primary models for mobile-enabled payments:

1.       SMS based transactional payments

2.       In-App Payments

3.       Direct Mobile Billing

4.       Mobile commerce and/or web payments

5.       Peer-to-Peer payments

6.       Virtual currency payments

7.       Contactless payments

It would appear that around half of the developed world has made a mobile payment of some sort in the last 12 months according to this criteria – at a minimum an in-App purchase made from a mobile or iPad would qualify (that means my children at 10 and 8 can be included in the figures….)

So the question today is not, Have you ever made a Mobile Payment? but, how on earth have you managed to avoid making one?

To view jobs in the card and payment industry, go to http://www.cardandpaymentjobs.com

O2 becomes latest company to launch a digital wallet

Hot on the heels of Barclay’s Pingit and Barclaycard’s Paytag, O2 has become the latest company in the UK to offer a digital wallet.

The product allows a number of functions, including:

·         Money Message – enabling  daily transfers of between £1 and £500 to any UK mobile phone number

·         Shopping via your mobile – A  barcode and search engine function compares the prices of millions of branded goods from more than 100 online retailers

·         Your phone as your wallet – O2 Wallet enables consumers to digitise their existing debit and credit cards making paying for goods or services via their mobile a reality. Customers can load money into their O2 Wallet account via one of their debit cards, by receiving a Money Message or with cash at more than 30,000 locations including O2 stores, PayPoint and epay retail outlets. O2 Wallet’s ‘transaction history’ will allow consumers to keep on top of their expenditure with text alerts when the account balance changes; a 30-day payment history on the app; and a 12-month history online

·         O2 Money Account Card – O2 Wallet offers both a physical and a virtual O2 Money Account Card. Both are based on a Visa prepaid account. Consumers can also apply for the physical O2 Money Visa Account Card, a contactless card  to pay for things on the high street or withdraw cash from ATMs available for use at more than 100,000 contactless payment points across the UK

James Le Brocq, Managing Director at O2 Money, said O2 believes that the new product “will transform the way people manage their finances and spend money.”

But in reality, how long will this “transformation” take ? And who is the demographic it will appeal to the most? How long before it trickles down to the late adopters?   

Additional functionality will soon enable consumers to use O2 Wallet to top-up mobile airtime, and buy train tickets.

O2 Wallet is compatible with the majority of smartphones as well as iPads. Even those without a smartphone can use various features of O2 Wallet – for example Money Messages – providing they have web browsing capability on their handsets.

It will be interesting to see the take up of the O2 Wallet. The proportion of people using mobile banking increased from 9.7% in 2010 to 20.4% in 2011. It is predicted that shopping on mobile devices is set to increase by 53% in the next 12 months hitting £4.5bn and making Brits the biggest mobile shoppers in Europe.

How long before digital wallets and mobile payments trickle down to the late adopters ?

For the latest jobs in cards and payments, go to http://www.cardandpaymentjobs.com

Cash will all but die out by 2032

Clive Kahn, chief executive of CardSave, a POS terminal provider to SMEs, believes that cash will account for less than 10% of transactions by 2032.

A new generation of consumers who are regular users of credit and debit cards could mean the end of the road for cash as we increasingly prefer to flex our plastic.

Kahn’s statement comes at a time when CardSave  has seen business double in the past five years, as a significant number of SMEs accept card payments.

Statistics from the UK Cards Association show that between 2008 and 2011, the number of UK card transactions increased by over 25%.

According to a YouGov survey commissioned by CardSave, 74% of the public carries less than £30 in their wallet, while 93% carry a credit or debit card.

The survey found that 57% of people believe that cash will become extinct in the future – 50% predicting  that it will happen by 2035 and 36% by 2025.

In addition, it also found that 40% of consumers believe that being able to pay for everything by card would make their lives easier.

CardSave has seen an increase in small businesses and sole traders - such as electricians - taking card payments to help boost customer numbers and end the hassle of cash-handling.

Devices such as Barclays Pingit mobile payments service is a recent  innovation that could also contribute to boosting the cashless society. It allows individuals and sole traders to send and receive money by mobile for free - and enticingly you don’t have to be a Barclays customer to sign up.

It is expected that more payment companies and banks will follow Barclays' initiative and launch competing systems.

The CardSave report also states that  30% of people say that they have found themselves inconvenienced in the past year by retailers that do not accept card payments, with as many as 16% of people walking out of a shop without making their intended purchase because the retailer didn’t accept cards.

Kahn believes that is one of the reasons retailers are leaning to accepting card payments.

He said: ‘In today's difficult times shopkeepers need to do all that they can to boost their business, which often drives them to accept cards.

‘Taking cards has a positive impact on the business as customers’ spending power is no longer limited to the amount of cash they have in their pocket.’

According to CardSave figures, the biggest growth areas in terms of merchants taking card payments have come from hairdressers, fast food restaurants, car servicing, pubs and taxis.

According to Khan, the main factors driving the demise of cash are generational differences and the increase of technology.

He says that the under 30 tend to carry and use much less cash than older generations, over time as the younger age group makes up a higher proportion of transactions, cash usage will decline.

He believes that the introduction of payment methods that are quicker and easier to use than cash will have the biggest impact on its demise  - and the impact will be felt most within the next five years, when the ability to make electronic payments from smartphones will be prevalent.

Do you think we will be completely cashless in our lifetime?? I can't even bring myself to perform internet banking.... watch this space...........

To view the latest jobs in the card and payment industry, go to http://www.cardandpaymentjobs.com

Visa executive states Mobile won't kill card payments in emerging markets

According to Elizabeth Buse, Visa’s group president for Asia Pacific, Central Europe, Middle East and Africa, Visa Inc. still sees a future in payment with plastic, even in the emerging markets where it is aggressively seeking to reach unbanked consumers through new mobile payment platforms. Despite the anticipated ubiquity of a range of mobile payment systems in emerging markets, such as Indonesia and India, the growth of the middle class in these countries means credit cards will still be sought by consumers. "In those markets, you will have people who want feature-rich credit products, typically with a card--those are the people that travel a lot, who do traditional shopping online and who tend to be at the top of the pyramid," stated Buse in an interview with Dow Jones Newswires. “Then you will have the people from the rural areas, who today are excluded from financial services, who will likely have mobile as their only way and then you'll have some hybrid in between. You already see some of that in India today." Visa Inc. which publicly listed in the U.S. in March 2008, is holding its first board meeting outside the U.S. in Singapore on the 25th April and 26th April. Singapore is Visa's largest location outside the U.S., employing more than 900 of the company's 8,000-strong global staff base. It is also close to the rapidly growing emerging markets Visa is keen to penetrate such as Indonesia. "There's a ton of cash here (Asia)--the way that we go after it would be different to the way we'd go after it in the U.S. or even Australia and that's where innovation comes in," Buse said. "And it's critically important over here because a lot of that cash is spent by people who don't have access to traditional banking system so they're unbanked to underbanked." Visa is close to achieving its goal of deriving 50% of its revenue from outside its home U.S. market by 2015 ahead of schedule; in the fourth quarter of last year, non-U.S. markets accounted for 46% of revenue. The group last year also acquired Fundamo--a South African mobile payments facility which operates in 40 countries, mostly in Africa--for US$110 million, a company it plans to use to deploy mobile payment systems throughout emerging markets. Fundamo has partnered with a microfinance wholesale bank, Bank Andara, in Indonesia and is in the process of rolling out a mobile payment system in the country using pre-paid Visa accounts. Buse says this programme is targeted at customers outside the major branch networks of Indonesia's banking system, predominantly people in the "bottom half" of the wealth pyramid. "Mobile, we believe, will be the way that electronic payments are brought to the majority of these populations," she said. "The rate of adoption though remains to be seen but we do think there will be a leapfrog in a number of these markets where the traditional infrastructure won't be there."

To view the latest card and payment jobs, go to http://www.cardandpaymentjobs.com

Barclaycard PayTag targets contactless payments market

Barclaycard has launched a stick-on credit card which will allow its 12 million customers the chance to make wave-and-pay purchases from their mobile phone or other item of their choice.

The PayTag is a quarter of the size of a traditional credit card and will sit unobtrusively on any mobile handset or other item, and is linked to a customer's traditional credit card account. It will let them make purchases in any "contactless" store, restaurant, and even on public transport.

Barclaycard hopes the move will trigger the mass take-up of contactless payments that has so far proved elusive.

In May, a select group of its credit card customers will be the first to receive the cards, with every cardholder eventually offered the free upgrade.

David Chan, CEO of Barclaycard Consumer Europe, said: "More than half of us say that the item we're most lost without is our mobile phone, so we're giving people the option of using them to make easy, convenient, everyday payments without the need to upgrade their current handset."

Currently, a number of banks allow customers to make contactless purchases with credit and debit cards. The payments do not require a pin number on purchases up to a maximum set by the bank. This is currently £15, but is set to rise to £20 in June.

Retailers accepting contactless payments have also been largely limited to coffee shops and a few larger stores such as Boots. However, the scheme received a major boost in January when McDonalds announced it was using the new technology in all its 1,200 outlets in a bid to cut queue times.

Visa predicts the number of contactless point-of-sale terminals in the UK will rise by 50% to 150,000 in 2012. The London Olympics is set to be the first contactless games, and major retailers that offer contactless payments will soon include Waitrose, WH Smith and Tesco. By the end of 2012, London buses will also accept contactless payments, followed by the Tube and the rest of the capital's transport network in 2013.

Trials of contactless payments around the world have seen users buy items in shops with "near field communication" technology embedded in their mobile handset. However, until now a lack of such handsets among consumers has held up the revolution.

PayTag, however, allows the card holder to turn any item into a mobile wallet.

Unlike existing credit and debit cards that can be used contactlessly, PayTag doesn't require a pin to be inputted every few transactions. Barclaycard has said it comes with the same 100% fraud protection as its other cards, and has promised to refund anyone who loses their card which is then used fraudulently.

This promise could be severely tested in months to come when users start leaving phones on buses late at night, and thieves realise they can make as many payments as they can before the card is reported missing and cancelled.

In March, Barclaycard parent company Barclays launched Pingit, a way to send money between bank accounts using a mobile app. It is predicted that £3bn of purchases will be made with mobile phones in the UK in 2016.

To view the latest exciting jobs in the card and payment industry, go to http://www.cardandpaymentjobs.com

PayPal announces Card Reader, app for Android, iOS

PayPal has announced a new mobile payment service involving a Card Reader and an app for the service called PayPal Here.

PayPal, has launched a new service to enable mobile payments named PayPal Here.

PayPal Here works in tandem with a small device that needs to be plugged into an Apple iPhone or Android based smartphone and used with a specific app. The PayPal Here app can be used to accept any type of credit card, debit card and even cash. The PayPal Here device and service will be immediately made available to selected merchants in the US, Australia, Canada and Hong Kong.

PayPal Here is the new mobile payment service that will let you pay using your credit card or debit card from practically anywhere. A small triangular dongle - Card Reader, needs to be plugged to the merchant's device and the PayPal Here app needs to be loaded on the iPhone or an Android smartphone. After that the merchant simply swipes users' credit/debit card across the dongle to initiate the transaction. Then the merchant has to enter the CVV and the other details. A receipt can then be printed using Apple's AirPrint wireless printing service.

Alternatively, the PayPal Here app can be used to scan the credit card or debit card using the smartphone's camera. The Merchant can then proceed with the transaction process. In any case, the merchant requires the customer to enter the CVV code and only then successfully complete the transaction. Besides enabling mobile payment, the PayPal Here app will offer integration to the merchant's inventory, invoices and billing systems.

It is interesting to see PayPal offer such  an innovative solution while mobile payments through Near Field Communication technology is still some time away from becoming a mainstream payment method.

 PayPal has already released a Widget that allows payments via NFC technology.

To view and apply for more jobs in the card and payment industry, go to http://www.cardandpaymentjobs.com

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