Vodafone adds card payments to its NFC wallet

Vodafone said customers in some of its European markets will be able to add bank cards to the Vodafone Wallet service and use smartphones to pay for goods and services at contactless terminals from the second quarter of 2015.

The UK-based operator has signed new agreements with Visa and Carta Worldwide to extend the existing contactless payment service based on near field communications (NFC) technology.

At present, Vodafone customers in Germany, Spain, the UK, Italy and the Netherlands are able to add loyalty cards to the Vodafone Wallet and pay via the Vodafone SmartPass app. Visa SmartPass, which was the first application of the mobile wallet service and based on a prepaid Visa solution, is designed for transactions under €25 ($27), with transactions in excess of that amount requiring a passcode.

Under the new agreements with Visa and Carta Worldwide, customers will be able to add their bank cards to the Vodafone Wallet app, where an alias of each card is stored in the Vodafone NFC SIM. They will then be able to confirm ownership of the card using Verified by Visa authentication; pay by tapping their phones against a contactless point-of-sale terminal; and check their mobile payment transaction history using their smartphones.

Mark Ritzmann, head of mCommerce at Vodafone Group, said: "The digital wallet just took another step forward. With a few clicks, customers will be able to add payment cards to their Vodafone Wallet and use Android smartphones to pay at contactless terminals. Thanks to our agreements with Visa and Carta Worldwide, using bank cards stored on Vodafone Wallet is fast, secure and simple."

Jeremy Nicholds, executive director mobile at Visa Europe, added that the initiative is part of the company's strategy to accelerate mobile payments and make it easier for banks to enable their cards to make payments on mobile phones.

For its part, Carta Worldwide is providing the payment card-enabling technology. "Our Next Generation platform is built to provide the highest security and reliability standards. At the same time, the flexibility of our platform has allowed us to develop this innovative service with Vodafone in record time," commented Brian Semkiw, CEO of Carta Worldwide.

Vodafone is one of many mobile operators worldwide that offer NFC-enabled services on smartphones, although several companies have been forced to reposition themselves following the launch of competing services such as Apple Pay and Google Wallet and the growing interest of banks in host card emulation (HCE): these applications leave mobile operators out of the value chain as the SIM is no longer relied on as the secure element.

In the U.S., for example, Google has now bought Softcard, the mobile payments joint venture backed by Verizon Wireless, AT&T Mobility and T-Mobile US.

In Denmark, TDC, Telenor, Telia and Three Denmark sold their mobile payments venture Paii to a rival company owned by banks, conceding that payment activities are perhaps more suited to financial institutions than telecoms service providers.

In the UK, Vodafone UK, EE and O2 UK--which is now to be acquired by Hutchison Whampoa subject to regulatory approval--are also part of the Weve mobile payments venture, which is understood to have abandoned plans to launch a standard mobile wallet.

Meanwhile Vodafone UK and EE continue to pursue their own contactless payment and NFC strategies: Vodafone has already said it intends to substantially expand its Vodafone Wallet service in the future to include services such as public transport tickets, e-tickets, contactless keys (for example to an office or hotel room) and many others.

EE's Cash on Tap contactless mobile payments service is now available on the London Underground, tram, DLR, Overground, National Rail services that accept Oyster, and on London buses.

For more:
- see this Vodafone release

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