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Paul Penrose


Paul Penrose - Finextra

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Trends in Financial Services

Trends in Financial Services

A community to discuss the future of financial services and any other interesting trends, strategies, ideas, views.
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RBS trials mobile debit payments technology

23 November 2007  |  14996 views  |  0
The Royal Bank of Scotland (RBS) is conducting trials of mobile contactless debit payments technology at its Edinburgh headquarters ahead of a public pilot next year.

Mobile payments gather momentum

23 November 2007  |  5365 views  |  1

Royal Bank of Scotland is to conduct internal staff trials of mobile payment technology using MasterCard's PayPass contactless system.

News of the pilot comes the day after the card scheme announced plans for a public trail of the technology in downtown Oslo with DnB Nor and Telenor.

Field trials have also been scheduled for Japan.

The latest initiatives follow a seemingly successful trial-run in Taiwan, in which three-quarters of the participants indicated a preference for the technology over traditional plastic cards.

The card issuers are past masters at hyping up new advances and talking their banking partners into ill-advised high-profile technology tests. Anyone remember 3-D Secure - the forerunner to SecureCode and Verified by Visa - which flopped miserably when banks discovered they couldn't get it to work properly, despite a mammoth two-year publicity blitz by the card companies. 

Will 'tap and go' on a mobile phone be any different?

Assuming the technology works, and there are no security distractions, I feel MasterCard could be on to a winner.

In Edinburgh, the RBS announcement comes with an unusually srong endorsement from the bank's chief executive of consumer banking, Paul Geddes: "We...believe that mobile phones will be the next step in the payments evolution."

Anyone out there disagree? 

TagsPaymentsRetail banking

Comments: (2)

Ainsley Ward
Ainsley Ward - ACWA Consulting - Diegem | 03 December, 2007, 12:31

There are a few wrong assumptions in the whole 'mobile payments' area that cause me to think it won't take off in the way banks hope:

1. More people consider their iPod to be an essential device than their mobile phone (particularly those in the under 24's bracket)

2. Banks are willing to fund transfer of the payment app every time somebody changes their phone - after all, it's not something I'd be willing to pay for.

If the banks are looking to step away from traditional plastic, then they will be heading into the exceptionally sensitive world of consumer gadgetry and be subject to the will's and want's of increasingly fluctuating consumer trends. I can see from the feedback in trials that 'card on the mobile' is popular, but is this because it isn't a card, or that people really like it for what it is?

Banks should consider making their card product more useful rather than disintermediating one of their strongest brand identifiers in favour of Nokia, SonyEricsson et al. After all, as the phone manufacturers have proven, if it does more useful things, it becomes more essential to a consumer.

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Paul Penrose
Paul Penrose - Finextra - London | 05 December, 2007, 10:28

The iPod's a bit of a red herring. My 15-year old son has both an iPod and an MP3 player on his mobile phone. The mobile's the one he carries around all the time. In the future, I'd expect to see stand-alone iPod users gravitate to richer devices like the iTouch and ultimately the iPhone.

And, while there are many economic disincentives for the banks in the mobile payments space, you have to ask: Can they afford not to get involved?

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