Dec. 5, 2011– MasterCard and mFoundry announced an international collaboration in the emerging field of mobile payments. MasterCard hopes to tap mFoundry’s mobile banking applications, used by the likes of Citi and Bank of America, to push its PayPass contactless payments technology. Founded in 2004, mFoundry now claims more than 500 bank and credit union customers for its mobile payments technology and is also behind the successful Starbucks app. Previous investors include NCR and PayPal.
The collaboration and investment will combine MasterCard’s Tap & Go ™ PayPass technology with mFoundry’s mobile financial services platform to make mobile contactless payments accessible to more consumers. Mobile PayPass®, which uses Near Field Communication (NFC) technology, enables people to make fast, convenient and highly secure payments by simply tapping their NFC phone on any PayPass-enabled terminal at a merchant check-out.
Mobile phones provide the most promising tool for NFC payments, as consumers increasingly use their smartphones for a host of functions, including managing their finances. In the second quarter of 2011, comScore, a research and analysis firm, reported that 32.5 million Americans accessed mobile banking information on their mobile devices, a 21 percent increase from the fourth quarter of 2010. Almost 14 percent of all U.S. mobile subscribers now access banking information through their devices, according to comScore. mFoundry already provides mobile banking solutions for more than 560 banks and credit unions.
MasterCard and mFoundry also will collaborate to provide mobile phone operators an application that supports Mobile PayPass, allowing them to offer mobile contactless payments to their customers and providing an even greater opportunity to put mobile payments in the hands of consumers.
The collaboration will help open up more options for MasterCard cardholders to take advantage of Mobile PayPass, giving them greater flexibility in choosing how they use their mobile phones for payments. It also will encourage MasterCard’s leadership in contactless payments by expanding the technology to more payment providers.
“This collaboration with mFoundry is going to allow more banks, credit unions and mobile phone operators around the world to offer their customers the convenience and security of Mobile PayPass,” said Ed McLaughlin, chief emerging payments officer, MasterCard. “By using the power of a smartphone, consumers can simply tap and pay for goods and services.”
MasterCard has also made a strategic investment in US mobile money outfit mFoundry, leading a funding round that also includes Intel Capital, Fidelity Information Services and Motorola Mobility.
By incorporating PayPass into bank’s apps MasterCard is seeking to extend the uptake of its technology, building on its recently launched partnership with Google. MasterCard, like its traditional card rivals, is rushing to gain a foothold in the nascent mobile money market. Visa has acquired Fundamo and invested in Monitise and Square in the recent past while American Express has taken a stake in Payfone.
Update – Mobile payments in Europe
In Europe Dutch banks and telcos have firmed up their commitment to introduce contactless mobile payments but expect to introduce services in 2013, a year later than initially planned – according to Finextra. A consortium comprising ABN Amro, ING, KPN, Rabobank, T-Mobile and Vodafone inked a letter of intent in September 2010 to form a joint venture creating a single uniform system for mobile transactions in the Netherlands by 2012.
However, the players have pushed back their expected launch date by a year because they still need to go to the European Commission within the next few weeks to get competition law clearance, which could come early next year. Meanwhile, T-Mobile has pulled out of the group, stressing its belief in mobile payments but wanting to decide at a „later stage” how to approach the issue. The remaining members insist that their service will be open to all banks, mobile operators and other companies that want to use it.
Banking 4.0 – „how was the experience for you”
„So many people are coming here to Bucharest, people that I see and interact on linkedin and now I get the change to meet them in person. It was like being to the Football World Cup but this was the World Cup on linkedin in payments and open banking.”
Many more interesting quotes in the video below: