Three of Australia’s biggest banks — Commonwealth, Westpac, NAB — have formed a joint venture to build their own mobile payment app.
These are the same three banks who tried, but failed, to group together to negotiate with Apple over Apple Pay to access to the iPhone hardware necessary to build their own mobile wallets.
The consumer watchdog, the Australian Competition and Consumer Commission (ACCC), earlier this year rejected the approach, saying it was concerned this was likely to reduce or distort competition.
The ANZ has gone with Apple. Earlier this month the ANZ, via Apple Pay, became the first in Australia to offer contactless EFTPOS. Until now, Australians, even those with debit cards linked to savings or cheque accounts, went through the Visa or Mastercard credit card system if they chose to tap at the checkout, attracting higher fees.
This new project from the other three major banks will be based on debit cards.
Called Beem, the first product from the Commonwealth, Westpac and NAB joint venture will be an app for instant payments for all, including small businesses, regardless of who they bank with.
The free app will enable any customer of any bank to make an instant payment using their smartphone, and request payment from someone who owes them money or to split a bill.
Beem will work on both iOS and Android smartphones.
Think about all the times you’ve gone out for dinner and split the bill, says Antony Cahill, NAB’s chief operating officer.
“This app will make it easy for Australians to pay their family and friends instantly,” he says.
“Or, when you go to the local market and need to pay the butcher — this means instant payment through your phone.”
Matt Comyn, the Commonwealth Bank group executive of retail, says Beem will give Australians a simpler way to pay and request payments.
“Two thirds of small businesses say they are owed money for completed work, with around $7,300 owed to small traders,” he says.
“Beem will give small businesses a cost effective and easy way to collect payments instantly and on the go for their goods and services, without having to take the larger leap into using merchant credit facilities, or issuing invoices to be paid later.”
Beem will have bank level security and encrypted user account information. Every transaction will be authenticated and subject to real-time fraud monitoring.
The app will be available for download later this year. To be able to use the app, you’ll need a debit card issued by an Australian Authorised Deposit-taking Institution.
Beem will initially have a sending limit of $200 a day, or $6,000 a month, with a monthly receiving limit of $10,000 as an initial risk control measure.
The next project for the joint venture will be a digital wallet.