It’s all about the payment experience

There has been much discussion recently about the decision of two retailers in the US to drop NFC payments in order to stop Apple Pay being used in their stores. These stores are part of the Merchant Customer Exchange (MCX) consortium that is planning to launch a non bank payment product CurrentC next year.

On the face of it, it doesn’t seem unreasonable for retailers to want to save on their card merchant acquirer fees, plus a bit of competition is always good. However CurrentC depends on consumers ‘doing more’ and ‘sharing more’. The payment process involves unlocking your phone, launching an app, scanning a QR code, the retailer scanning a QR code (apparently you hand your phone to the retailer!); and that’s after setup which involves sharing drivers license and social security details plus linking the app to your bank account.

Contrast the CurrentC experience with Apple Pay, where the transaction uses existing card details and nothing is shared with the merchant, not even the card number. CurrentC looks like it’s all about the merchant, with the customer experience coming a distant second. If MCX retailers believe that CurrentC is so much better than ApplePay they should allow the two products to co-exist and see which one the consumer prefers.

I’ve always taken the view that for new payment systems to succeed they have to do two things for the consumer; be better than whatever they are aiming to replace and remove friction and frustration from the payment process. CurrentC appear to fail on both these points which is why I think it’s destined to fail. In contrast, Apple Pay simplifies and secures an existing process using the cards which consumers are already familiar with. Apple is positioned as a trusted partner and enabler who speeds up the payment process for consumers.

As Apple CEO Tim Cook said the other day; “You are only relevant as a retailer or merchant if your customers love you”.