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Wearables work, if you like adorning yourself with tings. 

Biometrics seem so much more natural, and there's no technology to make invisible, for the consumer that is...

Why not set the default card based upon the current location? For example, if you're at Hammersmith tube station, set default card to Oyster card. If you're at Harrod's, set default card to black Amex.

In Canada you have a super low cost national debit card network: Interac, which receives 1c for each transaction (from acquirer and issuer); and there is no interchange payable (at least for the next couple of years - government mandate).

And there is an increasing number of low cost card accepting terminals out there too...which are very often integrated into the merchant's point of sale.

So what is the need for a digital currency, when your loonies are already stored, accepted and processed digitally, at low cost?

Considering the above I don't understand the value of a digitial currency for use in-store...

Help?

Cheers,

Andrew.

I couldn't agree more with the sentiment that mobile wallets and associated applications are not well understood; in terms of customer, merchant and bank interaction, and therefore usage.

We have spent much time discussing consumer engagement models in different market segments (hopsitality - the obvious one, medical, fashion retail, etc), where behaviours, actors and interactions are different. We have discussed standalone payment apps, payment apps combined with loyalty, loyalty + payment + social, etc.

And we've come to the conclusion that we must follow the path of utter simplicity. Everything comes back to how I can make the punter's life easier. Making their relationship closer and more cool between the customer and merchant(s) isn't necessarily the winning ticket.

Issuers own the card-holder. Acquirers own the merchant.

Closed loop systems only work if the product / service is considered of sufficient (and specific) value (to merchant and card / wallet holder).

Open loop systems tend to generic in their product / service offerings, and often uncompetitive on price.

The third way of course is for new entrants to use existing payment rails provided by Visa, MasterCard, etc, and their own where possible; providing unique value add products and services on top of these rails. That way new entrants can scale up, and deepen merchant relationships, and therefore "stickiness", and hopefully margin.

In my opinion, the way forward for new entrants is to really understand how payments are made in different market segments, and then devise new methods to support these ways of paying. This often involves working with point of sale (POS) vendors, because they know their customers better than most, and, better payment experiences / methods involve the POS.

Hooking up mobile payments, including loyalty to a merchant POS is one of the most important things an existing acquirer can do. Isn't it?

The merchant will love you, because you've brought their customers closer to them, and they are able to purchase outside of the store. The customer is happier because they have yet more convenience and choice. (eCommerce has provided this for years now...How many POS's have online shopping cart or payment facilities? Now, how many actually support mobile payments / loyalty?) 

NFC, QR codes, etc are all technologies that allow us to implement payment experiences, but by themselves are not a panecea for promotion of radically new payment offerings.

Existing payment providers that understand these things and have the capacity to provide them will do well.

If card holders want fancy cards with fancy bells and whistles attached, then they should pay fancy prices for owning and using those cards, not the merchants (since acquirers pass the interchange fee through to them).

Schemes such as Visa and MasterCard still collect scheme fees, but surely these should be flat pricing only (not ad velorum), making the network much more cost effective for everyone.

Acquirers paying issuers an interchange fee for the privilege of accepting and routing issuers customers cards to them is a bit rich isn't it? After all, who is actually doing the heavy lifting in terms of technology rollouts and support? Not the issuing banks, that's for sure.

And since in the EU you have a single currency, and slowly but surely a single banking system, is there really any reason to collect cross border interchange fees?

No wonder there are new startups attempting to build alternative payment systems that reduce the cost of card transacting.

The more I look at the Canadians, and the legislative support they have introduced for Interac, around the elimination of (debit) interchange fees, the more impressed I am. Here finally, is a true "cost plus" payment network.