Photo: Daniel Goodman / Business Insider
Google officially launched Google Wallet, “the app that makes your phone your wallet,” at the end of September (for Sprint customers with a Nexus S 4G phone).Hot on its heels was the announcement from Isis, the AT&T, T-Mobile and Verizon consortium, that a number of handset-makers (HTC, LG, Motorola, RIM, Samsung and Sony Ericsson) have committed to make NFC-enabled devices that use the Isis standard, and so will Device Fidelity, maker of microSD cards that bring NFC functionality to devices that don’t have it.
Let the games begin.
I’ve already blogged about the roles I think Google and the mobile network operators will play when it comes to NFC. (See my recent post, Google Wallet: It’s Not About Payment.) Now, I want to talk about banks and merchants. How do they fit into the NFC picture?
Citibank is the only bank participating in Google Wallet right now, though Visa, Discover and American Express have made plans to be added to future versions of Google Wallet.
I think that the only reason they’ve joined up is that they think they have to be there. They want to be a part of the experiment. They want to be seen as forward thinking. At the same time, they’re working on their own initiatives. They’re participating in Google Wallet. They’ll participate in Isis, but they’re also hedging their bets with their own strategies.
Around the world, banks have been behind the majority of pilot programs for proximity payments like NFC. Very few have actually launched full-fledged services with NFC, because what’s in it for merchants and consumers is still questionable, and the distribution of the transaction revenue is still a challenge as there are more “mouths” at the table.
Obviously with Google’s involvement around CRM opportunities, looping in discount offers, location and loyalty etc., it does make NFC more interesting, but there are still some big hurdles to overcome, apart from just the handsets and readers.
The jury is still out on what will be successful about these early NFC services, and who will be successful, but I don’t think we’re going to see banks rushing to roll out services, or merchants standing in line to sign up for services anytime soon.
What do you think?
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