Mobile payments are growing in popularity, especially with phones such as the Nokia Lumia 920 on the market with NFC built-in. However, there are few companies with the reach and leverage to help make the magic of payments actually come to reality.
Meet Mung Ki Woo
Mung Ki Woo is Group Executive, Mobile, at MasterCard. In this role, he is responsible for leading the development and commercialization of mobile payment product platforms and solutions around the globe that create a sustainable competitive advantage for MasterCard and its customers.
Previously, he was vice president, Electronic Payments & Transactions at France Telecom – Orange, one of the largest telecom operators in the world with retail operations in 32 countries.
The idea behind mobile payments and a mobile wallet would bring about simplicity to anyone who carries a smartphone. Here in the US, our bulky wallets carry around multiple credit cards, debit cards, merchant credit cards and other cards such as grocery store loyalty cards and even the Starbucks card for your morning latte.
The opportunity to simplify this with a mobile wallet would be a huge win for consumers, but what stands in the way?
I sat down with Mung Ki Woo, Global Executive for Mobile at MasterCard, to discuss the future of payments and NFC.
According to Woo, there are three main trends happening with regards to payments and mobile devices:
- In developed economies, consumers are showing an increased interest in using their smartphones to make purchases at online and in physical shops. This includes scanning their phone to pay using a credit card info stored in their mobile wallet.
- In the developing world, mobile phones are leveraged to provide payment services to unbanked populations. More than 130 so-called mobile money services have already been launched.
- Merchants want to use their smartphones or tablets to accept payments from consumers.
There are some real conveniences to be brought to mobile power users with regards to NFC-enabled payments.
For example, right now, people get special offers from companies such as Groupon and LivingSocial and then use them in the future – perhaps even, from a mobile app. However, if we have discounts that are in our proximity and our mobile phone is NFC enabled, then one could imagine services where consumers will be able to discover, pay for and get these discounts all in an instant.
MasterCard’s strategy is to provide a seamless payment experience (both in the online and the physical worlds) and integrate payment services into new and innovative commerce services, such as offers and loyalty rewards.
Overcoming payment safety concerns
Even though mobile payments might be convenient, many people are not comfortable having all their personal payment cards accessible on their mobile. The idea sounds foreign and scary. For example, what if you lose your phone? Or what if it’s stolen?
Woo was quick to inform me that all payment data is stored on a secure chip inside the phone where the data is encrypted and inaccessible to anyone wishing to steal it, much like data on a smart card used throughout the world.
Also, studies have shown that in the case of a lost phone – most people are much quicker at realizing their phone is missing versus a wallet. Lastly, you can remotely delete the payment application off your phone should you need to do so.
MasterCard recognizes it has work to do when it comes to easing the public about overcoming the cultural roadblocks to mobile wallet adoption.
What will it take to make mobile payments a reality?
The biggest gap in getting to a new mobile payment-enabled world is about equipment. For merchants and payment processors, swapping out all those payment terminals inside stores will take time and money. Also, we have some way to go in terms of mass-adoption of NFC enabled handsets.
Mobile payments is a complex industry because there are many players including mobile handset manufacturers, mobile carriers, banks and payment processors, all of which want to make sure their entities’ needs are being met.
However, Woo is optimistic because of new industry partnerships that have been forged and the companies involved are motivated to bring the service to consumers.
When the obstacles are overcome, businesses and the rest of us will benefit – because mobile phones will provide a sales channel that is personalized, quick and convenient.
Let us know – take our poll below to weigh in on whether you’d use NFC-powered mobile payments.