WiseGuide 6: Is 2012 going to be the year of mobile payments?


It’s not long ago that organizations have been keeping a remit of ‘Digital First’. Notably, print publishing companies have managed to weather tough times by addressing this and journalists have had to be the ones to adapt the quickest.

However, it very much seems like a number of companies and services are narrowing this down further and adopting a ‘Web Second, Mobile First’ strategy. In this post we explore some of the game changers in the mobile payments space and how they have had an impact (or will have, very soon) in our everyday lives.

We’ve already seen some consolidation happening in this space with Amex investing in Payfone, Ebay investing in Zong, but there are a number of payment technologies which have been around the block for a while and have maintained a strong independent position.

Boku is one such firm. Founded in 2008, the company creates software that helps online merchants process payments using a customer’s cell phone number in place of a credit card. The charge gets accrued to the telephone bill of the user. Boku has managed to secure strong relationships with a number of operators and has some very influential clients in it’s list – including Facebook and Electronic Arts. It remains to be seen how quickly they shall be adopted for physical sale of goods, but such a large operator footprint does give them a huge advantage.

Square, founded in 2009 has gone the other way and essentially turned mobile phones into Point of Sale (POS) instruments. With a million merchants and the ability to come up with new consumer journeys, the company has gone a step further with it’s Card Case app.

Taking a cue from Near Field Communications, it’s using iOS’ geofencing technology to detect ‘regulars’ for merchants and now provides the facility to charge them on their tab – all without having to even take your phone out. Square has gotten into specific relationships whereby you would get a Square reader shipped for free with T-mobile 4G phone.

Google, never to be left far behind has been active in this space with Google Wallet. The user experience is slightly different, though. You need to enter your PIN at the point of sale from the Google Wallet app and presto, the payment is made. The battle continues for infrastructure, relationships and most importantly – consumer and merchant adoption. Other big players such as PayPal and Intuit have their toes dipped into this as well, making this a fiercely competitive field.

Innopay has an interesting report on trends observed in 2012 in the mobile payments space that worth a look.

Do let us know which payment technologies you are familiar with and which ones have you used personally. Have a chat with us on twitter or visit our facebook page

Image credits: Josh McKible

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