Loop – A new payments solution called Loop is looking to make its way into the ever complex pile of payments options. The solution leverages current infrastructure in place by accessing MSR readers in place and communicating with them over the air via a case on the mobile device. Using current infrastructure is a smart move. Anyone with real world experience in retail technology knows that changing out thousands of stores with even a small piece of technology is a significant effort.
The even greater challenge is getting mindshare from the general public. The world has been overwhelmed with payment options; swiping, dipping, PIN, no PIN, tapping, scanning a barcode, RFID dongles, gift cards, scanning from mobile screens, NFC on mobile – there are too many choices and they are confusing to a great part of the population. As Square found out at Starbucks, even a slight change to the payments process can easily confuse store staff. Another unfortunate challenge is that the crowd that is most willing to attempt to use a mobile device to make payments are also the population least willing to stick a chunky case with a cable on their phone to enable payments.
From a selfish consumer’s perspective, the best way to deal with this sort of payments challenge is to put the payments infrastructure online and let the payments happen there. Consider Uber. For those that are unfamiliar, this app virtually flags down a cab / limo / SUV near you so they can pick you up and take you to your destination. Instead of holding cars up on the road while people pass cash back and forth or tap cards, customers put their credit card in the app and store it there. They request a car and see an estimated price. When they ride is over, the approve the payment within the app. The driver can validate payment received and everyone parts happily. No new infrastructure required and there is less inconvenience for the consumer.
Buying movie tickets with the Cineplex mobile app works the same way. Unfortunately one has to enter their credit card for every transaction, but still no need to wait in line once you get to the theatre. While there are risks from those who would use stolen cards, Cineplex found a way to deal with it, and I’m sure others will as well. While it’s a pain to have to enter credit cards in all of these apps, it beats putting some crazy case on my phone that will only work at some places.
While these are definitely point solutions and not the universal wallet that solutions like Loop are trying to enable, there are more and more mobile or tablet point of sale solutions and passing a card or cash (or God forbid a cheque) seems like more of an anachronism every day. It would be great to put it online, get away from readers of any sort and be done with it. Payment systems that do not depend on tapping, swiping or scanning ANYTHING are the best path to the future. If geo-fenced payments like pay with square or paypal here or even iBeacons could be used to enable geo-fenced payments so we could all quit with the crazy swiping, and signing that would be perfect. Fundamental changes like this take time, but every step counts, and I appreciate solutions like Loop trying to move us all in the right direction.
If anyone is looking for a real nut to crack, let’s figure out a way to put ID cards like Health Insurance and Drivers Licenses on mobile. Then we can really ditch the wallet.
Mastercard Shop This – Wired magazine (tablet edition) subscribers can access Mastercard’s Shop This functionality in the November edition. The concept is that with Shop This, consumers register their shipping details and their cards with Shop This and then they can buy items directly from the Wired magazine tablet edition without exiting the magazine app. Removing the need to enter details every time you wish to purchase something removes the barriers to purchasing, and that’s what Shop This enables. I found the initial version a bit disappointing as the Shop This logo doesn’t appear on all the items. Expect more of these sorts of schemes to enable simple payment and shipment in the same vein as Amazon and iTunes. In fact, iOS 7.0.3, released today, enables keychain capability to extend to iPhones to allow Safari to remember address and credit card details across devices and browsers.