One of the biggest disruptors for the FinTech sector in recent years has been the spread of the smartphone. These gadgets are now ubiquitous to the point of saturation in many markets, and this presents many new opportunities for banking and payments.
A solution that’s set to be increasingly popular is the use of smartphones to make in-store payments, using Near Field Communication technology to connect to point-of-sale machines.
But it’s not traditional banks that are leading this drive – it’s technology companies. The likes of Apple, Samsung and Google have all ramped up their efforts recently, rolling out new services around the world.
Android Pay extends its reach
Last month, for instance, Google announced it will be extending its Android Pay solution to users in the UK, with the support of several of the country’s biggest banks, including Bank of Scotland, First Direct, Halifax, HSBC, Lloyds Bank, M&S Bank, MBNA and Nationwide Building Society.
Elsewhere, Australia is also expected to gain access to Android Pay in 2016 as Google looks to make up ground on Apple, whose competing Apple Pay system is already available in the US, UK and mainland China, and for users of American Express cards in Canada, Australia and Singapore.
Getting users on board
But the key test for mobile payment solutions such as Android Pay will be whether consumers feel comfortable with the technology – and in particular if they are satisfied with its security.
In the US, Google claims that the service has been growing steadily, with 1.5 million new registrations per month. However, it may be the case that many users will need incentives in order to adopt the technology.
For example, customers of Verizon in the US are currently being offered up to 2GB of free data on their mobile phone plan if they try Android Pay, with 1GB on offer for the first time the service is used, and a further 1GB when they make their third Android Pay transaction.
This may indicate there’s still work to be done if tech providers are to convince consumers of the merits of mobile payments – but the hope is clearly that once people try the technology and experience how convenient it is, they will be hooked.