Since the dawn of the mobile wallet in 2011, there’s been somewhat of a rush from networks and manufacturers to make paying with our cards and cash a thing of the past.
While things may not have entirely worked out for some of these early services (Orange’s Quicktap, anyone?), and others have suffered an aborted effort (Weve Wallet), things are nevertheless rapidly looking up for the world of mobile payments.
Using one’s mobile to ‘store’ money may not have found much appeal, but using our smartphones to actually make purchases has retained its allure. Enter…contactless payments. The ability to make ins-store purchases without our wallets, but with one wave of our handset instead. It saves time and requires minimum effort, thereby improving the customer experience. But are we persuaded?
Let’s take a look at these four mobile payment systems that are dominating the contactless market, to find out.
EE Cash On Tap
First there was Orange’s Quicktap. Now, there is EE’s Cash on Tap.
Cash on Tap can be used to pay for almost anything over-the-counter, up to the value of £20, with just a tap of the phone on any contactless payment reader. EE customers simply need to download the app and enter the details of the card they wish to use to top up their account.
Pros
– As Cash on Tap is built using Mastercard, you can be sure it’s pretty secure.
– As well as paying for things in store, Cash on Tap can also be used on the London transport system to pay for tube tickets and bus journeys.
– The costs of one’s travel are capped, just like a real Osyter card, to avoid you going over your limit.
– The clever Autoload feature means you’ll always have exactly what you need in your wallet, so you won’t be caught off guard.
Cons
– Cash on Tap can’t be used for purchases above £20
– It can’t be used to pay for transport outside of London
– Its only available on selected handsets
– It’s not available to T-Mobile and Orange customers, whose networks have been taken over by EE.
Zapp
Zapp is showing distinct promise for the future of contactless retail, having managed to get five leading UK banks on its side and applying contactless payment to a greater variety of uses.
As it links directly to one’s bank account, there’s no need to ‘top up’ as with EE Cash on Tap, and Zapp can be used to pay for things in-store, online, and even bills sent through the post using QR codes.
With HSBC, First Direct, Nationwide, Santander and Metro Bank backing its cause, Zapp is perhaps leading the way in terms of customer trust and market appeal, and is set to launch this Autumn.
Pros:
– As it’s linked directly to your bank account, cash is always available so long as you have funds.
– Zapp promises not to share your information with third parties.
– Users can view their balance at any time, giving them more control over their money and curbing those impulsive purchases.
– Zapp has a greater variety of uses, and can even be used by businesses to sell their products.
– The company has employed new adaptive behavioural analytics from Featurespace (which spots subtle changes at account level) to fight fraud.
Cons:
– You may need your bank to be signed up to Zapp before you can use it.
– Other than that, we can’t think of any!
Kash
Kash is a neat little app that claims to ‘get rid of the middle man’ between bank accounts and retailers. Its only available right now in the US and Canada, but with things moving so quickly in the UK in terms of contactless payments, it would be natural to expect that Kash will be available here soon too.
Kash is a free app that enables customers to pay directly from their bank accounts and retailers to eliminate pesky credit card fees, which can cost 2, 3 or 4% per transaction. Larger businesses are charged just 1% for every transaction after $100,000, and extra features like Kash Marketing also help businesses reach larger audiences.
Pros:
– It can save small-medium retailers considerable amounts in transaction fees.
– It is free to use for both customers and retailers, and anybody can use it.
– It can help increase business traffic.
– Deposits made using Kash are fast – just one business day.
– Customers are given perks and rewards for making purchases.
– There are daily limits to help customers manage their spending.
– Kash gives customers their first purchase for free.
– The app’s creators will accept responsibility for all security issues that might occur from using the app.
Cons:
– It is only available in the USA and Canada, and on selected devices.
– Retailers will need a dedicated processing terminal supplied by Kash, rather than an ordinary contactless payment reader.
– Customers may be bombarded with offers and campaign news from Kash.
– It can only be used to make in-store purchases.
Apple Pay
As with everything Apple, Apple Pay has stoked rumours of its success ever since its conception, with critics anticipating the platform to succeed ‘in ways that ‘Paypal, Google and Visa have failed’. Set to launch in the US this month, Apple Pay is not an app but an in-build NFC feature of the new iPhone 6 and the Apple Watch.
To use, customers simply need to hover their iPhone over the contactless reader and hold their finger on the Touch ID button. It can be used for in-app purchases in the Apple Store, as well as on the high street. It withdraws directly from one’s bank account and works with major credit card providers Visa, Mastercard and American Express.
Pros:
– Card details are not visible when making transactions, as is the case with physical credit cards. Instead, a unique Device Account Number is assigned, which is encrypted and kept private from Apple and everybody else.
– Transaction information is not saved, meaning no purchases can be linked back to you.
– Your accounts are protected even if you lose your device, thanks to Find My iPhone. Use this feature to switch your phone to ‘Lost Mode’, or wipe your phone’s stored credentials altogether.
– Apple Pay is accepted at 220,000 stores and counting, and it’s also useful for in-app purchases.
– As it’s built into the phone, there’s no need to install an extra app.
Cons
– Apple Pay isn’t expected to be available in the UK until 2015.
– It’s unique to iPhone 6 or 6 Plus owners only, or those who own the Apple Watch and have it linked to an iPhone 5, 5c, or 5s.
Admittedly, it may be a long time yet before we see an absence of wallets altogether here in the UK. But with EE’s Cash on Tap already in full swing, and Zapp hot on its heels, it’ll certainly be interesting to see how people choose to integrate their smartphones into their shopping habits in this new way.
As for Apple Pay…time will only tell whether the tech giant will live up to expectations, and resurface the face of the contactless payment market all over again.
