MCX, the mobile payments joint venture set up by a coalition of some of the largest retailers in the US, has confirmed that members using the system will be contractually obliged to exclude alternative platforms provided by the likes of Apple and the telco-backed Softcard consortium. Meanwhile, the group has confirmed that pilot participant email addresses have been stolen by hackers.
The issue of exclusivity has come to the fore following the decisions by MCX member firms CVS and Rite Aid to block Apple Pay transactions in their stores.
In a blog post
explaining its position, MCX says: "MCX merchants make their own decisions about what solutions they want to bring to their customers; the choice is theirs. When merchants choose to work with MCX, they choose to do so exclusively and we’re proud of the long list of merchants who have partnered with us. Importantly, if a merchant decides to stop working with MCX, there are no fines."
During a hastily convened press call, MCX CEO Dekkers Davidson again claimed, contrary to a New York times report, that there are no fines for members using Apple Pay. Asked if retailers are able to leave at any time, he replied only that they are "free" to make the best decisions for their consumers.
In the future, he suggested that it is possible that merchants could accept both CurrentC and Apple Pay, conceding that it will likely require two or three successful players to reach the mobile payments tipping point, but, for now, it is one or the other.
Davidson also moved to downplay the importance of QR codes to CurrentC, insisting that the platform is technologically agnostic and that the group is already working on BLE options, with NFC a possibility in the future.
The group, which claims support from 50 merchants at 110,000 US high street storefronts, says its barcode scanning payments and loyalty system was conceived at a time when the market lacked a viable mobile wallet that would benefit both consumers and retailers.
"Today, we believe that need still exists, and our working group is getting ready to reveal a solution that is different from other mobile payment options in many important ways."
Whether the group will be allowed to enforce its terms of service is questionable. Earlier this week, the bank-backed trade association ETA branded the boycott of alternative mobile platforms as 'anti-competitive'.
"This decision has nothing to do with convenience, reliability, or security," stated the lobby group. "Because MCX says its retailers represent 1/5 of total US retail sales, this group boycott could negatively impact consumer choice in the mobile payments marketplace."
Worse still for the MCX retailers, the JV has confirmed that in the last 36 hours it has discovered that pilot participant email addresses have been taken following a data breach. The group says that no other information was taken and that the CurrentC app itself was not affected. Nevertheless, the news rather flies in the face of an MCX pledge that "consumers’ privacy and data security are our top priorities".
During today's press call, Davidson refused to name the third party vendor which was hacked and said that incident would not affect the timeline for the CurrentC public launch. He also refused to speculate on who could be behind the attack but did note that the JV was taking on an established industry and expected to faced resistance.