Target Pay: Just One More Sign That MCX Is Dead

Not two weeks since we learned that the grand pappy of MCX, Walmart was launching Walmart Pay, we learn that another of its anchor tenants, Target, plans to do the same.

Reuters reported late on Friday (Dec. 18) that Target is reportedly developing its own mobile wallet, adding another major “Pay” player to the already crowded mobile payments space.

While this hasn’t been officially confirmed by Target, unnamed sources said to be close to the matter said the company is in the early stages of its mobile payments plans. What this plan involves, according to said sources, is launching its own mobile wallet app similar to those in the market that enable consumers to make mobile payments at the point of sale.

Can you spell MCX’s death by a thousand cuts?

What hasn’t been relayed — as this potential plan develops — is what credit cards companies Target would partner with for the launch and which specific type of mobile payments they would implement. One source indicated the technology has not been tested in stores yet.

What the latest sources have shared about Target’s mobile wallet plans is that the retailer’s plans involve integrating the wallet into its mobile app — similar to Walmart. Target is also looking beyond NFC and instead will rely on QR codes, which is what Walmart and Starbucks use.

Target would likely connect its own credit cards to its app, but the sources that spoke with Reuters indicated that Target would likely also work with credit card companies in order to integrate those cards into the app.

Which they don’t really have to do at all. Walmart Pay is leveraging its Walmart.com registered accounts and using the cards in those “wallets” to essentially enable an eCommerce transaction via the app in the store at the point of sale. No permission from banks needed.

And like Walmart, Target said on the record that it remains a participant in the Columbus, Ohio trial of the MCX CurrentC app.

“Target is a participant of the MCX and we are testing its CurrentC mobile wallet with guests as part of a pilot in Columbus, Ohio,” Target spokesman Eddie Baeb told Reuters.

But let’s face it, if MCX were killing it in Columbus, there’d be no talk of a competing app by Target or Walmart since there’d be no need to consider a merchant-branded alternative. As we’ve written since MCX was first introduced, the notion of a consortia of retail competitors launching a payments scheme seemed ill-fated from the start. And, the merchants that were part of it, were contractually hamstrung until contracts began to expire at the end of the summer.

Initially, those merchants, at least the big ones, started to throw their arms around Apple Pay, after a number of early in the year kerfuffle’s at MCX merchants with NFC readers that inadvertently accepted Apple Pay. For most of 2015, the rumors on the mobile pay street have been that Target would eventually accept Apple Pay. In June, Target CEO Brian Cornell dropped a big hint that the retailer was open to accepting Apple Pay — indicating that Target would eventually accept the payment option.

He first was waiting for chip-and-PIN cards to make their way into the market when he made those remarks. But what he did say over the summer was that ““I’d love to have Apple Pay today,” he said, adding that he has spoken with Apple CEO Tim Cook about the possibility, and noted that “once we finish, we’ll be open-minded.”

Best Buy, CVS and Dunkin’s weren’t far behind. Dunkin’s announced the launch of its upgraded app to include mobile order and pay last month.

The other open question is what this means for Chase Pay. Chase Pay announced in October that it was partnering with MCX and its app would be accepted at MCX merchants. It’s hard to know now just what that means since at least from this perch, it appears that there is less and less likelihood that there is an MCX there-there – at least not for much longer.