In tech we trust but not in banks?
I read a very interesting article by freelance journalist Edie Lush last week. The piece, titled 'A world without banks: why Barclays and co should be afraid', makes the point that, according the latest Edelman Trust Barometer, banks and financial institutions are the least trusted global institutions while technology companies are the most trusted. The point is this: Is it crazy to think that for some customers the idea of a tech company, such as Apple or Google, managing their digital wallet makes more sense and is more reassuring than, say, a regular bank?
It's a scenario that, if we are honest, many of us in the industry have probably raised in hushed tones at least once in the past few years as the march towards mass acceptance and usage of the mobile wallet has got underway. I think the big card companies realise this. MasterCard now describes itself as a technology company in the global payments industry more than a financial services company. Ditto for Visa Europe, who are a payments technology business these days. I'm not knocking these companies - just pointing out that the term 'technology' now inspires more confidence than the term 'banking'. So it leads onto the question – should banks be sidelined in the whole mobile wallet rollout, if a more customer positive attitude can be gained from having MNOs or technology companies take the lead'? Just some food for thought.
In fact, another 'technology' company - this time an MNO - stepped into the limelight last week with the launch of their NFC mobile payment service, launching in Strasbourg and Caen. I'm talking, of course, about Orange. In conjunction with Visa Europe the commercial launch of Orange Cash was launched in both cities. The reasoning being that these two cities had the highest use of contactless payments in France. With the launch, Orange becomes the first mobile network operator in France to offer mobile contactless payments to its customers.
The Orange Cash application acts as a ‘mobile purse’, taking the form of a Visa prepaid card on a phone. In order to take full advantage of the Visa contactless payment solution, Orange customers who have an NFC smartphone compatible with Orange Cash will have to go into an Orange store. Once the app has been downloaded, users can activate the service – regardless of their bank.
And to continue in my very tenuous banking/technology vein - banks are know for their physical security, but NXP have demonstrated how the humble lock can become a super secure NFC-enabled one (I warned you that the link was tenuous… ). NXP's Smart Home Access vision is to bring existing mechanical locking systems to the next level enabling smart life solutions. Today, smart card based access systems are in use by many enterprises, governmental institutions, hotels and campuses worldwide. In a joint effort, partners of NXP have transformed these solutions into optimized offerings for private homes, where mechanical keys are still dominant. In a worldwide field test these solutions have been implemented using a group of over 50 employees from NXP Semiconductors who volunteered to use MIFARE enabled smart door locks replacing their traditional mechanical locking systems in their private homes. The physical installation as well as the programming of the lock was done by the candidates themselves. A survey showed that more than 80% of the participants managed the physical integration without any difficulties. Many employees confirmed that they would rather forget their keys than their smart phones. Now that it is trust of technology over more traditional methods… Not sure I would do it but well done to those who did.
And finally - PayPal president David Marcus had less than ideal coverage in the press last week (I know the phrase 'All press is good press'. I don't agree). However, in Marcus' case, it started with him announcing on his Twitter feed that: "My card (with EMV chip) got skimmed while in the UK. Ton of fraudulent 'txns' (?). Wouldn't have happened if merchant accepted PayPal…". Needless to say, there were responses back to this tweet - all along roughly the same line of '@davidmarcus implies EMV is flawed. Also unlikely the fraud was committed in Europe without the chip'. He did clarify his thoughts later with the tweet; "to be fair. It's the mag stripe that most likely got cloned. Not chip."
It wasn't until an internal PayPal memo was leaked that things really started to get a little hotter for the PayPal chief. In a contentiously titled piece called 'PayPal chief reams employees: Use our app or quit', Venture Beat claims that Marcus has instructed his San Jose office to either get with the program and use the PayPal app or go and work elsewhere. He also goes on to say “Employees in other offices hack into Coke machines to make them accept PayPal because they feel passionately about using PayPal everywhere. I don’t see these behaviors here in San Jose.” It's hard not to see the irony when only a day before he had complained that his credit card had been hacked. Venture Beat was quick to point out that, "clearly not all hacking is acceptable in Marcus’ book — only hacking that supports the company’s business objectives". This story got a little traction - some insiders thought that pressuring employees to use the product was tantamount to corporate bullying while other praised him for it.
I thought this was an interesting position. If we are trying to get the mass mass market to trust companies involved in contactless & NFC technology, be it door locks, ticketing or payment - how far do you go to make sure that company employees actively use their own products and technology, and at what point do you make it compulsory rather than optional. Surely everyone would be using these products, especially those working for 'technology' companies. Their products, solutions and technology are, after all, the most trustworthy - are they not?
Until next week,
Steve Atkins
Contactless Intelligence
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