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It’s a battle for our wallets—literally, to be our wallets—and retailers like Walmart are losing. While Apple Pay continues to gain traction with users and retailers alike, Walmart and the other major retailers behind the Merchant Customer Exchange, or MCX, haven’t even gotten their mobile payment app off the ground.
I didn’t even know a potential major shake-up was in the works until I read this article from Time, but it makes complete sense that retailers would seek a way around the 1-3 percent fee card-issuing banks charge them on credit card transactions. Those percentages add up to billions in fees paid each year, and apparently in 2012 Walmart, CVS, Target and others decided they’ve had enough. MCX claims it’s “the only merchant-owned mobile commerce network built to streamline the customer shopping experience.” What they came up with is a free app called CurrentC, offering exclusive coupons and promotions for users and the ability to earn rewards and choose how you pay—but the glitch is it still isn’t even in test markets yet. Meanwhile, Apple Pay is swiftly gaining on Paypal and Google Wallet in the mobile payments space.
Speaking of Google Wallet, it’s going head to head with Apple Pay this year through a distribution deal Google made recently with AT&T, T-Mobile and Verizon. The deal means Google Wallet will come preinstalled on Android phone sold by these carriers.
Another company has found a competitive space in between mobile payments and credit cards. A sort of mashup of both concepts, Stratos replaces all the cards in your wallet—credit, debit, loyalty and membership. David Pierce wrote an article last month in Wired chronicling his weekend using Stratos and the accompanying app that stores and switches between cards. While Pierce points out there are other companies doing the same thing, Stratos claims it will be different because its app will learn about your money and rewards and will prompt you to do things like use the credit card that will give you the most rewards.
Also coming down the pipeline later this year is the October 2015 deadline for retailers and banks to adopt the EMV payment standard, the chip-and-PIN technology Europe has used for years. The deadline is significant because it’s when liability for fraudulent transactions will shift. Whichever vendor, either the card-issuing bank or retailer—whoever has the outdated technology—will carry the liability for the fraud. However, the U.S. plans to move to a chip-and-signature standard, which is much less secure than having to verify a purchase with a PIN number. Anyone can forge a signature (and who checks anyway?). Still, it’s a move in the right direction, though Forrester Research estimates the U.S. won’t fully switch to chip and PIN until 2020.
Does your company need to deploy EMV technology? TEKsystems can manage your transition to chip-enabled point-of-sale systems by removing old readers, upgrading payment applications and replacing equipment. Learn more about our technology deployment services.
As part of TEKsystems’ public relations team, Vanessa Ulrich reads everything she can about the technology industry and emerging trends. Vanessa blogs about where technology and society collide, giving context and commentary to top news stories. You can reach her with questions and comments @TEK_PR via Twitter.