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volume 9 • fall 2016
payments survey the company conducted in April.
Banks also must gure out which payment protocol will be the most likely to catch on, and right now they have di ering opinions on whether NFC is the way to go. Smith of Wells Fargo is bullish on NFC’s potential for mobile wallet uptake. “We believe that the steady increase of NFC-enabled payment terminals, in addition to the prolif- eration of NFC-enabled ATMs, will drive customer adoption of mobile wallets,” he says.
Both Wells Fargo and Capital One are relying on NFC-enabled wallets. Chase will be able to work with NFC where applicable, but the bank plans to incorporate open protocols, such as barcodes and QR codes, rather than rely solely on NFC.
Creating ubiquity and widespread distribution will be the challenge for all mobile wallets, but the banks are in an advantageous position, says Bob Legters, senior vice president of product, banking
and payments at FIS, which pro- vides tech services for banks and has created a tokenized wallet that banks can integrate into their existing apps.
What sets the banks apart is that they can link consumers to secure data and bank account information in ways that third-party mobile wallets can’t. “At the end of the day, if you’re going to run all your nancial payment tools through
Ironically, when we rst launched payments, people began to ask us, ‘Why would we use a bank for payments 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 spend- ing and get the most from their credit
card rewards.
a product, you’re going to be more inclined to do that through one that’s issued by a nancial institution,” Legters says. “That’s the feedback we’ve gotten from some of our clients.”
Particularly among the larger institutions, more banks are show- ing an interest in adding mobile payment functions to their apps, although it’s not their primary request, adds Walt Granville, senior vice president of mobile innovation for Cachet Financial Solutions,
—Tom Poole, Capital One
which helps banks integrate services into their mobile apps.
“There are a number of limitations that exist in most people’s banking applications that they want to address, more than adding pay- ment,” Granville says. Those features include biometric authen- tication, mobile remote deposit capture, money transfer options, card controls, and personal nan- cial management data and tools. “But I do think payment is slowly
but surely becoming an area our clients are looking at.”
Even if the banks gain a more prominent spot in the mobile payments market, it’s unlikely
there will be one wallet to rule them all, just as there’s no domi- nant card or payment type, Crone says. But there’s still a gaping hole in the market that the banks could easily ll. “It’s the nancial institu- tions’ to lose,” Crone says. “But you can’t hit the ball unless you swing the bat.”
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