Wearable devices are transitioning from being geek-favoured items into the main stream. At this point, along with the growing popularity of the wearable devices, we face increasing approval in mobile payments as well. Hence, it is only but natural to expect boundless and exciting evolution when it comes to the era of wearable payment devices.
It appears that it is a normal evolution to witness how the matured mobile payment technology merges into the devices that we wear. After all, mobile payments are all about improving the totality of anybody's payment experience. So what better way to pay with something that you wear unlike with a device that needs pulling out from your pocket/wallet.
HERE'S A GLANCE AT 6 WEARABLE PAYMENTS PLAYERS THAT YOU NEED TO BE AWARE OF:
Apple is about to bring the wearable device to the mob, making it something that people cannot simply ignore. This 38mm to 42mm device becomes a desirable piece spanning to 16-year old guys, same as it is desired by 65-year old retired ladies.
Warning – geek paragraph ahead:
A key element of the security mechanism of mobile payments rely on NFC technology which involves the Secure Element component. The Secure Element is a piece of hardware that locks the sensitive information like credit card details to a specific device. It means that Apple had to create additional secure element on the Watch on top of the NFC sensor.
From the user experience perspective, even if the user already had his card set on Apple Pay, another set of activities is required to operate it on the watch.
In addition, security layer of 4-digit password was added onto the watch as part of the security double layer philosophy of combining "Something I own" (Watch) and "Something I know" (password).
Overall though, the payment experience is simple and straight forward.
Samsung's latest wearable device -- the Samsung Gear S2 now offers mobile payment capabilities. It is equipped with an NFC chip and is used as a part of Samsung Pay mobile payment solution.
It seems that both companies, Apple and Samsung are taking the same approach by offering payments on their wearable devices by relying on their existing Mobile Payment ecosystems. The user experience will be seamless, tapping the watch on contactless credit card reader at the cashier will do the job.
Contactless payment terminals are becoming the common practice among retailers globally and almost any new advanced model of payment terminals contain contactless reader built-in. Therefore, users enjoy wide range of stores that can accept mobile and wearable payments.
Samsung Pay is a mobile payment system which lets you buy goods by just tapping your phone against the card reader in a shop or restaurant instead of using your credit or debit card. Payments are authorised when the owner of the phone presses against the phone's fingerprint reader, or enters a PIN. It is currently available in South Korea and will be introduced in the US on 28 September. Samsung has suggested that it will expands to the UK, Spain and China in the near future.
Credit and debit cards from banks and card issuers who have partnered with Samsung can be uploaded to your phone, just as they can with Apple Pay.
Samsung is also rolling out Samsung Pay with the Gear S, which means like Apple users, you will be able to pay for things by the mere movement of your wrist. It works using NFC, so there is none of the magnetic strip payments which makes Samsung Pay so powerful, but it means you should be able to hand over contactless dollars at most places where you can use your card.
It probably was no surprise when Swatch announced that it, too, wanted a piece of the wearables game and launched Touch Zero One smartwatch model.
The device aims to be a fashionable item geared towards sports and active lifestyle usage. The latest reports indicates that Swatch already has an existing payments deal in China, known to be its largest market, with China UnionPay. Reports also has it that a payment model equipped with NFC component are also on the works.
Swatch will be a new player in the game and will jump straight to wearable payment skipping on the Mobile Payment phase that other key players went through.
When such giants partner to create something new, we should follow it carefully since those companies have the means, the know-how and the market size to make an effective solution that can make a huge difference in the market.
Alipay, China’s leading online payment system owned by e-commerce giant Alibaba Group has a volume of over $150 billion, which means it consistently surpasses the volume of PayPal. Yet to know the acceptance network in the Chinese retailers environment and the ability of the solution to expand globally remains something to watch out for.
The MagicBand is great example of a closed-loop wearable device that is used for payments within the Disney facility.
It seems that closed-loop environments are the most efficient way to launch a new payment method, same as the most popular mobile payment environment as Starbucks card on the mobile.
The MagicBand is a colourful wristband that is actually more than wearable payment device, it is all-in-one device that connects visitors to many activities that require authentication inside the Disney ecosystem such as to enter the various parks, unlock Disney Resort hotel room and buy food along with other merchandise. Their main selling point is how the device unlocks many other magical moments igniting anyone’s Disney experience doubling up as a key to a more carefree (equating to a happier) visit.
The MagicBand truly demonstrates the power of wearable payments by significantly improving the user experience and taking the full advantage of the device’s capabilities.
This fitness tracker decided to add payment component to their wearable device, Jawbone’s new UP4 wearable fitness tracker will support contactless payments from American Express, based on NFC.
It will be interesting to see how the solution is adopted by the market and if other fitness wearable gadgets will jump into this pool.
I wonder if Fitbit or Nike Fuel has payment plans as well.
Yoav is the CEO of YuuPay Secure Pte Ltd, a Singapore-based Payment Service Provider. He has over 15 years of experience in the Payment, Mobile and IT Industry, specializing in Mobile Payment, Mobile Value Added Services (VAS) and Internet and Mobile content. He has an MBA from Heriot Watt University and a BA in IT and Business Administration.
"Working with YuuPay is like working with a hands-on partner who cares about how I can make the most of my business in terms of online payments..."
"YuuPay has no idea how they made life easier for me as I am setting up the payment aspect of my online business..."
© Copyright 2015 YuuPay Secure Pte Ltd. All Rights Reserved.