People around the world rely on mobile more and more every day. It has changed the way we communicate, interact with the world, and has given us new ways to buy goods and services. Also, it has changed the way we pay for them. Today, there are more than 3 billion smartphones with NFC (near-field communication) technology which enables us to use any of the major mobile payments systems – Android Pay, Samsung Pay and Apple Pay.
In China, cash transactions are becoming obsolete, and the cashless society is becoming a reality. In 2016, the value of their mobile payments has risen to $5 trillion. The rest of the world is sure to follow their lead. China is the pioneer market for mobile payments today.
What are the Benefits of Mobile Payments?
There are always people who don’t trust new technology, who hesitate to follow trends and slowly accept technological advancements in their everyday lives. However, mobile payments are now being recognized and adopted for these three primary reasons.
- Security. The details of your payment details are never exposed because mobile payment solutions use tokenization to process your payment details. It makes the cellular payment process more secure when compared to plastic cards.
- Speed. Grab your smartphone, hold it close to the POS (Point of Sale) terminal, and make instant payments. Pay online using stored card information within your cell phone.
- Convenience. Mobile payments are very convenient because you no longer need a purse or a wallet to make payments. There’s no need to carry cards or cash. You can store all of your cards inside of your mobile wallet and select the one you want to use each time you make a payment.
MasterCard and Visa have teamed up in collaboration with NXP Semiconductors to create mWallet 2GO. Visa recently announced the launch of their new white label wallet service, mWallet 2GO. Built on the NXP Secure Service 2GO platform, they are first in the industry to offer an all-in-one solution for a mobile wallet. It is created to accelerate time-to-market, reduce cost, and ease development for Original Equipment Manufacturers (OEMs) to add mobile payment capability to any IoT or mobile device.
The mWallet 2GO solution is the first to integrate NFC (Near Field Communications), NFC middleware, Secure Element (SE), Secure Element Management Service (SEMS), SE applets, SE JavaCard operating system, Mastercard Digital Enablement Service (MDES), Visa Token Service (VTS), and software developer kit and wallet application. These advanced technologies have been unified by NXP to offer OEMs a fully validated and pre-certified turnkey security solution.
MasterCard’s Cardless ATM services
MasterCard and Diebold Nixdorf (an American corporation engaged primarily in self-service transaction systems) have teamed up to test Cardless ATM and MasterCard Cash Pick-Up, their two new cash provision services.
Cardless ATM powered by MasterCard allows users to use their mobile banking app to withdraw cash from the nearest ATM. As for the MasterCard Cash Pick-Up, banks can enable their ATMs to deliver paper currency to their account holders without the use of plastic cards. That dramatically improves the consumer experience, but more importantly, ATM deployers and banks get new transaction volumes, increasing their revenues. Transactions are conducted through the cloud and the app, keeping sensitive information is kept secure.
This technology stands as a great opportunity for moving the ATM technologies towards a global standard and drive digital innovation in the ATM channel. MasterCard and Diebold Nixdorf, have demonstrated their cardless technology at Money 20/20 Europe in Amsterdam, June 4-6, 2018.
Visa’s Investment in YellowPepper
To help accelerate innovation in digital payment technology, Visa invested in YellowPepper (Latin American mobile payments pioneer.) Both companies share a vision for increasing usage of mobile payments throughout the Caribbean and Latin America, and the investment is made to reinforce it. In 2017, YellowPepper and Visa entered a multi-year partnership.
Visa has also invested in solarisBank, Stripe, Square, Klarna, Margeta, and Chain (among others), and continues to evaluate different technologies and platforms that have the potential to enhance digital payments for their clients and customers.
YellowPepper offers Visa (as a Visa Token Service Provider) digital and secure payment token services so any device connected to the Internet can become a safer place for making payments. Visa wants to support their new partners and open up their Visa ecosystem to enhance and redefine the buying experience for their customers around the world. Their preliminary efforts are focused on expanding the usage of Visa Direct push payments, increasing access to Visa APIs, and growing opportunities for tokenized payments.
The switch to mobile payments is accelerating
With these major announcements from significant financial service and technology corporations, we should expect the mobile payments revolution to continue to change and enhance our payment experience, making it more convenient, faster, and secure. Banks, smartphone providers, app developers, wireless carriers, and credit card companies are forming partnerships to redefine their clients’ purchasing experience and revolutionize mobile payment capabilities.
With these significant enhancements in mobile payments, we must ask ourselves – what is the future of money and payments? By looking at Chinese urban centers, we can see that they are quickly becoming cash-free zones. It is saving the country resources and money as the Chinese move away from paper currency towards mobile payment technologies (while just four years ago, everyone was still using paper money.) Mobile payments have the strong potential to eventually become the default way of spending money and making payments, with every individual and organization plugged into the mobile payment ecosystem.