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Could banks be the big decider on mobile payments?

October 20, 2015

Over the past few years, many experts have been saying that consumers and merchants alike would soon begin adopting mobile payment processing platforms en masse.

Over the past few years, many experts have been saying that consumers and merchants alike would soon begin adopting mobile payment processing platforms en masse. However, while there has been slow but steady increases in the number of users for these systems, there hasn’t been the tidal wave many expected. However, one group that obviously has a large say in the way these things go still hasn’t committed to it entirely, and that could be a major game-changer in the near future.

Banks themselves have largely been happy to sit on the sidelines and watch as tech giants have really started the mobile payments revolution, according to a report from Android Headlines. Instead of really getting behind these platforms, or developing their own, they’ve simply been content to cut deals with companies like Apple and Android, among others, to process more secure mobile payments on their networks without actually getting too much of their own skin in the game. However, that may change in the very near future.

What’s happening now?
It seems that mobile payment acceptance might have reached a tipping point that many major banks may have been waiting to see, the report said. Capital One recently announced that it would develop a payment system that worked through its own smartphone app, and potentially become the first of many large financial institutions to roll out similar features.

The reason that there’s now an expectation that banks will get in on the game is that there’s no reason not to do it, the report said. Not only are Apple, Android, Samsung, and other mobile payment platforms just taking a slice of the pie when it comes to payment processing, these platforms are also more secure than even the tap-to-pay credit cards that are now in wide circulation and use across the country.

Bank-run mobile payment platforms could soon be quite popular.Bank-run mobile payment platforms could soon be quite popular.

Potential impediments
However, right now there might not be that much wiggle room for banks to launch their own platforms, the report said. The latest release of the Android mobile operating system allows third-party apps, including those from banks, to access payment data if consumers allow it, and that’s crucial to getting more use out of those existing systems, as well as emerging ones, the report said. However, Apple has made no such allowances for broader use of the payment data consumers input on their phones, meaning that even if people with iPhones or Apple Watches wanted to use a bank’s platform instead of Apple’s they would not be able to at this time. That doesn’t mean a future build of iOS won’t allow for that use, but it does not do so right now.

Certainly, these are all things for merchants to keep a close eye on as time goes by. The more they can do to accept mobile payments as the ubiquity and variety of these platforms increase, the better off they’re likely to be when it comes to meeting consumers’ needs.

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