Page 36 - Pay Magazine s2014

digital money
Will Bank-Backed M-Wallets Win?
MCX ShiftS StrateGy to tap potential of ChaSe Wallet, fis
MCX’s decision to shelve its own mobile payments app and shift its attention to partnerships with nancial institutions could signal a turning point for the retailer consortium’s mobile wallet strategy.
MCX announced in May that it would hold off on the nationwide rollout of its CurrentC mobile payments platform and focus instead on working with FIs such as Chase, a deal that could be a game changer for both the bank and the consortium. Under MCX’s agreement with Chase, Chase Pay will be accepted at MCX’s more than 100,000 member retail loca- tions. Chase has garnered support of merchants through MCX and other partnerships and has the advantage of a large customer base. This creates a closed-loop among merchants, consumers and the bank.
Rick Oglesby, president of AZ Payments Group LLC, says a consumer-led approach is going to be necessary for mobile wallets to take hold, which is why MCX’s partnership with Chase is signi cant. One of MCX’s biggest
objectives is to create an environment in which banks have to compete with each other to gain acceptance at the largest merchants in the world.
“That’s why their pivot makes a lot of sense,” he adds. “Their deal with Chase is a big step in that direction, so they really need to focus on making it work.”
Last year, MCX began testing its CurrentC QR- based wallet through a pilot program in Columbus, Ohio. MCX CEO Brian Mooney said publicly that the results of the pilot were part of the reason behind the consortium’s strategy shift. MCX has not yet indicated whether it will end CurrentC permanently. Stores stopped accepting CurrentC on June 28.
MCX’s decision to postpone CurrentC resulted in a staff reduction of about 30 employees, because MCX said it will need fewer resources. “People say
MCX is dead because they dropped out of CurrentC. I tend to disagree with that. The goals of MCX haven’t changed, but the approach has,” Oglesby says.
Capital One’s platform enables consumers with Capital One credit and debit cards to use an NFC- enabled Apple or Android device to make contactless payments.
more skepticism than optimism about the need for a bank-backed wallet. Now those attitudes are changing, says Tom Poole, the bank’s managing vice president
for mobile and emerging payments.
“Ironically, when we rst launched payments, people began to ask us, ‘Why would we use a bank for pay- ments versus a digital company?’ But as customers began to use our wallet, they loved the convenience of being able to stay on top of their spending and get the most from their credit card rewards,” Poole says.
Right now, the wallet app provides real-time spend alerts, the ability to store gift cards and receipts, and transaction monitoring with special alerts for things like un- usually large tips or potential double charges. Based on feed- back, Capital One is seeing a
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