Converged what? Wallet?
The payment market has for some time now been talking about a converged wallet, but what exactly is that? Is it a “ninja version” of a mobile wallet, or is it simply an evolution of a mobile wallet?
A few years ago everyone spoke about Omnichannel and how it would revolutionize the way marketing, consumer- and shopping experience work. But in order to make omnichannel work, you need a payment instrument that works for all channels. This Omnichannel payments will typically be gathered in a “wallet”, let us call it a converged wallet for now (see what I did there?), which is the ultimate tool for payments through all channels.
The converged wallet got its name from the convergence of in-app, online and in-store payments through the same payment instrument; the wallet. Through tokenization and the introduction of Digital Secure Remote Payments (DSRP), the same tokenized card can be used for payment in all channels. This brings security and convenience to a new level, whereas tokenization protects the cardholder’s actual PAN. In addition, will DSRP and Masterpass increase the convenience when shopping online or in-app.
Is the timing right?
The time for making your move towards the mobile- and digital space, is now. There are huge changes in the market with new FinTechs popping up every week and regulatory changes like PSD2 and GDPR. The market is forced open by new actors. It is of great importance to stay relevant, updated and competitive. Many banks have started their strategies and initiative in the mobile and digital sphere, but the technology and markets for converged wallets have yet not been mature enough. We now have the needed technology, both mobile payments, as well as the market’s readiness have matured, so all the pieces are lined up and available. Now!
Youths expect their banks to offer mobile and digital services, and are very open to change bank for what they consider to be better services and products. This is a radical change to how it used to be. Customers are no longer loyal to their banks, and digital and mobile services are one of the driving forces for this “infidelity”. Banks are now in the position where they must choose their direction. Will they move in front and maintain the customer relationships with the technology, services, and products the customers expect, or will they accept that other actors will handle that part?
If the choice is to let other actors take care of new services, the bank will stay relevant for their customers merely as an invisible infrastructure. Both are strategies, but by choosing the passive one, the bank might end up disrupted by a startup bank, or someone else. They need to catch up with innovations and technology now in order to stay in the race.
How is it possible?
The way we in MeaWallet have solved our converged wallet is by combining the online and in-app shopping from Masterpass with tokenization through American Express Token Service, Mastercard Digital Enablement Service and Visa Token Service for HCE payments. This combination is great, allowing the users to pay wherever a card can be used, might it be in a webshop, in a physical store or in a merchant app.
Masterpass is a giant actor for in-app and webshop payments that permits consumers to store their credentials in a safe place and provide the merchant with these while shopping online. This significantly reduces friction and drop-off rate for the merchants. The HCE payments are performed by using the payment networks’ tokenization solutions, ensuring global acceptance and interoperability.
So is it a ninja then?
So let us go back to the beginning of this blog post, where we asked; Is a converged wallet a “ninja version” of a mobile wallet, or is it simply evolution of a mobile wallet? I think it is an impossible conclusion to draw, but it surely is a great leap in the right direction to become the one and only payment instrument you will need. It is omnichannel for payments, connecting all the dots.
To sum it up; it is more than evolution although it cannot do insane ninja tricks. Yet!
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