Will Wallets Mobilize Mobile Point of Sale?

Partnerships have always been a part of mPOS, really since the beginning. They’ve started to take on a new dimension lately though as largely due to the integration of mobile wallets with POS systems, allowing for the acceptance of mobile payments. This partnership was exemplified recently when Square and Revel Systems joined forces to enable mPOS solutions at Whole Foods but really began in January of 2013 when PayPal and NCR teamed up to deliver PayPal acceptance via NCR .

In a recent podcast interview, ROAM CEO Ken Paull told MPD CEO Karen Webster why the relationship between mobile wallets and mPOS is valuable, and what ROAM is doing to enable those partnerships that could add a whole new dimension to mPOS.

KW: The recent mPOS Tracker Report shows that we’re starting to see something that is a little different in the space – that’s this notion of the relationship between mobile wallets and mPOS solutions. What do you think the implications are to the ecosystem with respect to that development?

KP: I think a lot of it is following in the trends of what’s happened in the physical world, like when payments rolled out to brick-and-mortar and even in what’s happened in ecommerce. If we look back in history, the first wave in mPOS was just basic acceptance, and having a system that worked and could be reasonably supported. Then, we started to see a lot of value-add capabilities come in. We are seeing partnerships now that are bringing enhancements into mobile payments, things like fraud screening, enhanced reporting and analytics, which are giving the merchants a better secure and control their solutions.

KW: So who are you seeing seize these opportunities, and what do they expect to generate from taking advantage of these new channels?

KP: All of the players who are active in value-added services want to be part of it. In some cases it’s the established players in the ecosystem, but in other cases it’s the new companies just starting up that are building solutions solely around mobile. They are seizing the opportunity to bring out products in this area. A lot of it is headed toward an omnichannel offering. Today, a merchant has various vendors they deal with, depending on whether they’re working with physical, ecommerce, or mPOS, and there are a lot of partnerships being formed to bring those together.

KW: The idea of mobile wallets and these opportunities to align mobile wallets with mPOS solutions is interesting. But since consumers have to have a mobile wallet, is this accomplishing what you think it needs to accomplish, or is it simply the first step in trying to solve the “chicken-and-egg” problem of getting mobile wallet acceptance in some of these new environments?

KP: Looking at the mobile wallets that are accepted by mobile mPOS, there’s not currently a significant amount of volume on the transactional side. However, without a doubt, that’s going to come. The key is for merchants to have a system that has the architecture that supports the integration of the mobile wallets, because there’ll be a lot of closed-loop and open-loop wallets entering the space over time. But the dust still hasn’t settled on what’s going on in that arena.

KW: Who are you seeing engage in these partnership opportunities and are they doing different things to move the mobile wallet solution down the field?

KP: Definitely. You already mentioned in the MPOS Tracker Report that Revel and Square working on integrating mobile wallets into their mobile acceptance products. We also saw Heartland and LevelUp team up. PayPal, of course, is always in the forefront– we will see a lot of activity from them in terms of partnering with different vendors. But I think one of the events everyone has been waiting for is when the Apple iPhone will have a mobile wallet capability – we will see all sorts of partnerships happen as a result of that.

KW: Let’s talk about what ROAM is doing in enabling these partnerships. I know the ROAMmcm5 platform capability allows for the frictionless enablement of partnerships, while maintaining integrity of user data and things that are important to the channel. What exactly does the ROAMmcm5 do?

We recently rebuilt our system, keeping in mind one primary focus: that it is API-driven, allowing companies to use it as the core engine to build around. Merchants have the ability to integrate their own boarding system, wallets, CRM system, and more. The intention of the mcm5 is to give customers the ability to take matters into their own hands, or to customize their own white-labeled solution.

KW: How does this mcm5 capability allow the channel to maximize revenue opportunities around mPOS?

As the market matures, people are looking at it more strategically. You have the retail use cases, like the people who didn’t take electronic payments before. Then, you have the non-retail use cases. There is a lot of activity there with companies involved in charities, home sales, home services, and transportation. All of these services require customization, and that makes for a whole little ecosystem of different partnerships.

KW: With the evolution of the market, so many of the things that were served up as features are now expected as core functionalities. Are there things that you’re hearing people ask that are surprising, or that they perhaps wouldn’t normally ask for so soon in the process of rolling out their mPOS solutions? 

There are a lot of things, but for most of them I’m under NDA and can’t talk about. It is amazing and not amazing at the same time that it has become commonplace for everyone to have a wish list of things they would like to get into a program. There’s no end to it. It’s not surprising that everyone has a lot of brainstorming going on, but the question is, which ones will add value to the merchant and consumer experience?

To hear more about how mobile wallets are affecting the mPOS ecosystem, listen to the full podcast here. To download the full mPOS Tracker Report, click here.

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