Tag: MCX

Visa Puts Signature On Skirmish With Retailers

Visa filed a suit against Walmart June 30, the latest volley in a legal shootout with large retailers over EMV, chip-and-PIN and signature policies. “To me, it’s a clear escalation in the battle, said Rick Oglesby, president of AZ Payments Group and a partner at Double Diamond Group. “It’s never a good thing to be wrapped up in a public dispute with one of your largest and most influential customers, and the networks versus Walmart has been ongoing for many years.”

The suit claims Walmart surreptitiously tested a process in which shoppers were not given the choice to verify their Visa debit card purchases with a signature. It’s the most recent salvo in a battle among Visa and large retailers over the use of either signatures or PINs to verify transactions.

With A New Mission, Walmart Pay Goes Live In Arkansas, Texas

Now that Walmart no longer has to pretend to be support CurrentC—thanks to its effective demise, courtesy of MCX’s concession to reality—the largest retail chain announced Monday (May 16) that it had rolled out Walmart Pay across 110 Walmart stores in Arkansas and 480 Walmart stores in Texas. Walmart Pay the concept was announced by the merchant back in December. Walmart Pay has been rolled out in a way very different than Walmart wanted to do a mobile payment, but it’s a model that has been obviously shaped by Apple Pay.

Like Apple Pay, it supports “any major credit, debit, pre-paid or Walmart gift card.” But unlike Apple Pay, it works across iOS and Android devices. And unlike Apple Pay and every other NFC payment method, it can work on a far wider range of phones—especially older phones—that do not support NFC. All the phone needs is the ability to download an app and enough of a camera to scan a QR code. But Walmart Pay suffers a major weakness that Apple Pay doesn’t. As long as the shopper is willing to use the default card in Apple Pay, all that the shopper need do is hold the phone right above the card reader. It doesn’t need to be connected to any network, nor does the shopper have to launch an app, key in a password or manipulate the app in any way. Contrast that with Walmart Pay, which requires the shopper to find and then open the Walmart app, select Walmart Pay and then manually activate the camera and then scan a register QR code—which as many shoppers will confirm, isn’t always that easy to do on the first or second attempt.

MCX Concedes The Obvious: CurrentC Is Dead. Indeed, It Was Never Really Alive

When MCX on Monday (May 16) issued a statement that “MCX will postpone a nationwide rollout of its CurrentC application,” it was akin to U.S. presidential candidates who suspend their campaigns. It’s a polite way of saying “it’s over” without having to say those words outloud.

But for many reasons, CurrentC never had much of a chance, having been created in the most merchant-centric (OK, I’ll admit it: Walmart-centric) manner possible. It’s creation was to give retailers a way to sharply cut back interchange fees and it was being pushed by a merchant who was already paying among the very lowest interchange fee percentages of anyone.

Why The ChasePay/Starbucks Deal Makes A Difference

When Chase revealed on Tuesday (Feb. 23) that it had cut a deal with Starbucks to incorporate ChasePay into the SBUX mobile app this year, it signaled that ChasePay needs to be taken seriously. More precisely, it means that the mocha-merchant mobile-powerbroker takes ChasePay seriously, which is perhaps the best endorsement it could get.

ChasePay’s previous big deal was with MCX, which, to be fair, isn’t exactly the endorsement you want in mobile payments to be taken seriously. But for those care about mobile money—and who in this space doesn’t?—nobody disses Starbucks.

The Confusing Side Of Chase Pay

When Chase rolled out Chase Pay late last year, it risked customer confusion because it was adding a new payment mechanism to the Chase mobile packages already offered. Chase customers already have a Chase Visa card and, based on Chase’s recommendation, more than a million of those cards are already loaded into Apple Pay. Now Chase Pay will be automatically added to the Chase mobile app that already has 21 million active Chase customers, which guarantees there will be a significant overlap with the users of Apple Pay. The goal of Chase Pay is to have all 21 million Chase customers use Chase Pay with their existing Chase-issued credit, debit, and prepaid cards for in-store payments, which of course means they will need to learn how to use Chase Pay.

Cardholders will retain all the same rewards and consumer protections using Chase Pay as they have with their existing cards. Currently the Chase web site identifies the primary benefit as merchant discounts. But Chase customers that already have Chase cards provisioned into Apple Pay or Android Pay will confront an impossibly confusing choice relative to acceptance. Since Chase Pay will have a limited acceptance footprint that is different than the limited footprint associated with the NFC-based competitors, it strikes Mercator that a customer will simply become even more unsure what mobile app is accepted at which merchant locations and will revert instead to the tried and true physical card.

Walmart Pay: For The Retailer Who’s Given Up Trying To Get His Way

When Walmart last week introduced Walmart Pay, it was shown to be a simple app that would accept “any major payment type” but it would only work at Walmart. In short, it was the last thing that interchange-fee-hating Walmart wanted to do, especially in the mobile world. MCX’s original vision, a merchant utopia where transactions were done in the non-interchange grab-the-money-directly-from-the-shopper’s-bank-account universe and one app was used at thousands of different merchant stores, was Walmart’s dream.

Mike Cook is the Walmart Senior VP/Assistant Treasurer who initiated the idea of MCX and pushed it so aggressively that many involved—and especially those who chose to not be involved—said the name virtually stood for Mike Cook Exchange. When Walmart Pay was announced, it was Cook whose name was on a statement issued to the media. Said Cook: “We remain committed to MCX, and recently launched acceptance of CurrentC in all of our locations in the Columbus market. We view Walmart Pay and CurrentC as complementary mobile payments solutions, and expect the two to build off each other’s success.” Walmart expects “the two to build off each other’s success”? If Walmart had even the slightest confidence that MCX and CurrentC were going to enjoy even a modicum of success, Walmart Pay wouldn’t have been rolled out. It’s true they will support both—there’s not a lot of reason to not do so—but Walmart Pay is everything Walmart didn’t want to do.

Use Apple Pay, Get Free Rides On The London Underground

The only viable long-term way to get shoppers to change their preferred payments method is to give them a reason to do so. Whether that’s a discount for using NFC rather than plastic or greenbacks, coupons/discounts that are only available using a specific payment method or some other perk, consumers need to get something concrete. This is the bulk of the message that MCX is screaming. Someone at Apple is paying attention.

With its U.K. rollout, MasterCard announced free Apple Pay travel days until the end of the year, but only on Mondays. Technically, the fares aren’t free but riders will have those fares reimbursed. “Customers can travel on Tube, buses, tram, DLR, London Overground and most National Rail services in London,” said a MasterCard statement. “From a standing start to today, over 220 million journeys have been made using contactless bank cards and devices with over one million contactless journeys made every day. Currently, contactless journeys made across all modes make up nearly 25 percent of pay as you go journeys.” More to the point, though, those contactless payments have generated non-travel contactless payments.

MasterCard Thinks It Can Standardize Mobile Loyalty. And It Might Be Right

For mobile payments to move into the massive adoption phase, some version of loyalty/couponing will be essential. Otherwise, once the novelty wears off, there are simply no sustainable reasons for shoppers to stick with mobile. But with every mobile player preparing to somehow push loyalty, the chance of having conflicting incompatible technology is all-but-certain. Can MasterCard change that?

On Tuesday (Nov. 17), the number two card brand introduced a loyalty middleware specification that it hopes will be adopted widely enough to give mobile loyalty a chance to grow seamlessly. Given that few if any mobile payment schemes will be offered without support for at least one issuer’s MasterCard, the card brand seems a sufficiently politically neutral player to sidestep the usual vendor resistance. In MasterCard’s statement, the brand said it’s proposed specification “enables mobile applications to offer a seamless connection between payment, promotions and loyalty redemption. It enables consumers to select their loyalty card, the coupons/promotions they want to redeem, and make a payment in a single or double tap at a contactless terminal.”

Apple Wants Into P2P Payments, Talking With Chase, CapOne, Wells Fargo, U.S. Bancorp

In an attempt to control as much consumer payments as possible, Apple is in negotiations with J.P. Morgan Chase, Capital One, Wells Fargo and U.S. Bancorp to launch a bank-account-based P2P payments service, according to a Wednesday report in The Wall Street Journal. If successful, it’s value would be huge to Apple, but not on a per-transaction fee basis. The goldmine would be the data, the equivalent of knowing every check, money transfer and payment card transaction made by millions of its customers.

Beyond the privacy implications of a consumer goods company having so much consumer personal data—on top of whatever health data is being gathered through Apple’s Health app—there are also security concerns. The more avenues of access that exist into a bank account, the more chances there are for a glitch to withdraw more than expected or for the ultra-sensitive bank account routing numbers to leak where a cyberthief could see it.

MCX Finally Gets Its Interchange Break—After Chase Hands It To Them

When JPMorgan Chase on Monday (Oct. 26) promised new mobile capabilities for its online Chase Pay program next summer, it chose to take a decidedly retailer-oriented approach. With the lures of lower interchange fees plus all of the fraud cost protections of the EMV liability shift without having to accept EMV, Chase has given retailers concrete reasons to push Chase Pay over other payment methods.

The Chase announcement named MCX (and specifically members Walmart, Target, Best Buy and Shell) as premier partner. Interestingly, the interchange reduction effort that caused MCX to form years ago but had been all but abandoned by the group recently is the centerpiece of Chase’s 2016 plans. What MCX couldn’t get on their own was handed to them by Chase.