Battle For Mobile Payments: Guide to Universal Cards

While the vast majority of consumers are still using plastic cards to make debit and credit card payments, a revolution is on the horizon. Digital alternatives will soon replace traditional POS payments. The end game will be making purchases using mobile devices and NFC. Until then, some believe all-in-one payment cards may lighten consumer wallets.

By Deva Annamalai, Director, Innovation and Insights, Fiserv

The first part of this two-part series looked at the dynamic and ever changing mobile wallet landscape. In Battle For Mobile Payments: Guide to Digital Wallets, we reviewed the primary mobile wallet competition, including Apple Pay, Android Pay/Google Wallet, Samsung Pay (with LoopPay MST), MCX/CurrentC/Paydiant Wallet and PayPal Wallet.

In this article, we take a slight detour from mainstream payment technologies and visit some of the lesser known, but still exciting, offerings. Each of firms reviewed are startups that are betting on the fact that credit card as a form factor will be a hard habit for consumers abandon.

They all can be categorized as All-In-One or Universal Cards … allowing consumers to store more than one credit/debit/loyalty/ID card on a single piece of plastic and allowing switching between cards using electronics integrated on the card. Their message is, “Let us replace all of your current plastic with our single card.”

Their offerings are similar in many ways with slight differences from one to the other. While the offerings resemble a conventional credit card, they require a smartphone (primarily iOS or Android) as a supporting device to load different credit cards into the digital wallet. They use BLE to pair to the smartphone. Once the card is out of range from the phone, they enter into a lockdown mode that prevents the card from being used fraudulently.

We will analyze the following four offerings (some of which have been covered previously on The Financial Brand:

1. Coin Card
2. Plastc Card
3. Swyp Card
4. Stratos Card

Since the four products provide many similar features, most of their strengths, weaknesses, opportunities and threats are also similar.

Strengths:

• Both Apple and Android users can use these cards as a unified mobile wallet/Universal card platform.
• Works well in payment scenarios where the card has be to be handed to a merchant for a payment (like restaurants).
• Works with most of the traditional magstripe card readers. Some of the offerings also promise future support for EMV and tokenization.

Weaknesses

• Considered by many industry analysts as a stopgap technology. With the industry titans like Apple, Google, Samsung, PayPal and MCX throwing their weight behind a mobile-only solution, it is not clear what the appetite for these cards will be from the general public.
• None of the four cards evaluated in this article have been shipped and are available for pre-order only. This leaves much to be desired when solutions like Apple Pay and Google Wallet are available today. The promised shipping time varies between the four players.

Opportunities:

• It is all about execution. If these cards manage to ship on time and start gaining user loyalty with a robust offering, they may fill in a niche (Coin has already missed several deadlines).
• Some of the cards (like Stratos) offer a membership-based model, which probably can be co-branded by financial institutions for their premier clientele.

Threats:

• Again, It is all about execution. Some of these cards have had a rough time delivering on initial promises, leaving them with unsatisfied initial adopters who paid and are waiting for the product.
• With the bigger players like Google and Apple throwing their weight on the ring, these players do not have too much wiggle room to make mistakes.

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