With New Debit Card, Google Admits Digital Isn’t Everything

With New Debit Card, Google Admits Digital Isn’t Everything

The maker of all things digital is introducing a debit card for accessing Google Wallet accounts. Google is getting physical.

A debit card alone is not a platform, or at least not a new one. In this case, it’s the payments version of comfort food: an everyday, easy-to-use technology to drive greater adoption of the less familiar Wallet platform.

This isn’t a new concept for a digital wallet. PayPal itself has a debit card. The significance for Google is more in its apparent acknowledgment that its business needs to play in the physical world. Earlier this week, the company ramped up its Google Shopping Express service with a partnership with Costco, further expanding its presence in the buying and selling of physical goods. Its self-driving cars are another way the company is reaching beyond digital, though never losing sight of the digital-derived lesson that the real business opportunity is in platforms, not just products.

The MasterCard-branded card is swipe-able at stores, and it can be used to withdraw cash at ATMs, Google said. The company pitched its new plastic in a blog post today as a way to pay for things offline without waiting for the money in your Google Wallet to transfer to a bank account.

This should sound familiar to users of PayPal or any other digital wallet, where the lag time between receiving money and being able to spend it makes such services marginal in the brick-and-mortar world, where most consumer dollars get spent.

That it took Google this long to make such a card available shows just how hard it is for the company to re-imagine itself as expanding beyond digital. For years, Google has supported NFC tap-to-pay technology that lets users of the few phones with such chips use their handsets to pay by Wallet at the few merchants with point-of-sale systems that support NFC. With the release of a debit card, Google seems to be acknowledging that battle is lost for now. In a world Google is trying to remake in its digital-first image, plastic still prevails.

 

Posted in Digital Wallet Privacy, Mobile Payments, Mobile Point of Sale, Near Field Communication, Point of Sale, Smartphone Tagged with: brick and mortar, costco, debit card, digital, handsets, MasterCard, nfc, payments, PayPal, phones, plastic, platform, point of sale, Tap to Pay, wallet

Reasons Mobile Payments Still Haven’t Caught On

All Alerts, All The Time

Will mobile payment apps hail the arrival of mobile interruptions that never let up? Consumers worry that adopting a mobile wallet app will open them up to a barrage of alerts, sounding the alarm every time the local supermarket has toilet paper for half-off. The services can even track your purchases, opening the floodgates for targeted ads. Frequent alerts could be a deal breaker.

Battery Woes

As smartphones gets bigger, badder and more powerful, battery technology is struggling to keep up. That’s a problem if you want to make a call — but it could be an emergency if your smartphone is your wallet, too. Users are already scrambling to find a charging outlet by lunchtime. Soon, failure to recharge might mean you lack the funds to buy lunch in the first place. Meanwhile, credit cards never need a battery boost, and paper money has worked faithfully since well before the invention of the light bulb.

Do I Have The Right Phone?

You’re ready to make a mobile payment — but is your smartphone? Only the most popular new Android and Windows smartphones have NFC support to enable tap-to-pay services, and Apple has decided to forgo NFC altogether with its iPhone handsets. Users of budget smartphones are likewise out of luck. And though smartphones may seem ubiquitous, only a little more than half of U.S. adults have one.

Is It Secure?

Mobile payments open up a whole new frontier for fraudsters — or so cautious consumers worry. In fact, tap-to-pay technology is as secure as swiping a plastic bank card, and cloud services like PayPal Here support two-factor authentication for extra reassurance. Still, consumers worry their personal information could be intercepted during a transaction, and not everyone is convinced that Google can provide the same level of protection as their bank. But hope remains. The survey found about half of the most security-conscious respondents were much more likely to be interested in mobile payment options if they could be promised 100 percent fraud protection.

Limits, Limits, Limits

Even with a glut of mobile payment options, most lack at least one critical feature. Google’s Wallet app lets you stow your payment information in your phone to buy items in brick-and-mortar shops, but its touch-to-pay functionality is limited to Android devices on Sprint and other smaller carriers. Last year, Apple introduced Passbook, a mobile wallet app that lets users store gift card credits, loyalty card information and more on their iPhones — but only a handful of participating businesses support the app. The mobile payment model isn’t just fragmented — it’s fundamentally limited by countless companies competing for an ever-smaller piece of the pie.

Mobile What?

A recent CMB Consumer Pulse survey showed about half of smartphone users have never even heard of mobile payments. And of the 50 percent who have, a meager 8 percent said they’re familiar with the technology. Banks, credit card companies and others hoping to cash in on consumer interest will have to invest in better messaging first.

What Are The Perks?

Credit cards come with alluring perks — signing bonuses, cash back and travel accommodations, to name a few. But mobile payment systems have serious benefits. They can utilize GPS technology to direct you to deals, keep tabs on your bank account to alert you when you’re near your spending limit, and store unlimited receipts straight to the cloud. Businesses profit from mobile wallets, too, which often charge lower fees than credit card companies and encourage return trips by storing digital copies of loyalty cards.

What’s In It For Me?

To convince consumers to abandon trusted payment options for something new, companies must strike an undeniable value proposition. In the late ‘90s, electronic retail giants like Amazon compelled consumers to enter their 16-digit credit card numbers into online portals, opening up a whole new world of convenience with online shopping. But today’s consumers aren’t convinced that mobile wallets are any more convenient than their physical counterparts. Credit and debit cards already offer a speedy, reliable way to pay on the go. And since they’re accepted virtually everywhere, customers can fork over a card without worry or confusion. Convincing people that new technology is worth their time and effort might ultimately be the toughest nut to crack for mobile payment purveyors.

Where’s The Support?

Even the most enthusiastic adopters are out of luck if their favorite shops lack the infrastructure to process mobile payments. Big-box retailers sprang up in the infancy of computer technology, so joining the mobile payment revolution could necessitate updates to check out hardware and software. Mobile payments could be a boon to businesses, but installing the upgrades could be expensive and disruptive — especially when consumer interest remains low.

Which to Pick?

Even curious consumers are confounded by the array of mobile payment options available. Google, Visa, MasterCard and even mobile carriers like Sprint and Verizon are among the heavy hitters on the mobile payment scene, each offering a discrete service with different apps — and different rules. Some rely on Near Field Communication (NFC) technology that lets users simply tap their smartphone against a special reader to pay, while others offer up scannable QR codes. Mobile payments may never take off until one company rises above the rest with a single killer service.

Forget about cash or credit. In 2013, consumers can simply swipe or scan their smartphones at the checkout to pay. A huge array of mobile payment services have sprung up in recent years, urging customers to abandon their plastic credit cards for the “mobile wallet” revolution, but so far, adoption of mobile payment technology has been dismal.

Posted in e-commerce & m-commerce, Electronic Payments, Gift & Loyalty Card Processing, Internet Payment Gateway, Mobile Payments, Mobile Point of Sale, Near Field Communication, Smartphone Tagged with: alerts, Android, Apple, bank card, battery, cautious, consumers, crack, credit cards, deal, digital, fraud, gift card credits, google, GPS, information, Iphone, lower fees, loyalty cards, mobile, nfc, online, options, paper money, Passbook, payment, PayPal, personal, phone, plastic, portals, powerful, protection, purchases, secure, Smartphones, sprint, storing, support, Swiping, Tap to Pay, touch-to-pay, track, two-factor authentication, wallet, windows