Mobile Wallets "Success Stories"

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Mobile Wallet Success Stories
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KnowledgeFaber
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SK Telecoms Smart Wallet in South Korea

• Generic Information
• SK Planet, SK telecoms internet service arm,
  launched the mobile wallet service in 2010.
• Supports array of functionalities like transport
  tickets, movie tickets, loyalty programs but
  lacks those of debit and credit cards.
• Reached 9 million subscribers with 2.5 million
  active users per month in April 2013.
• 220 service providers support the wallet.
• Can be used across 80,000 locations in South
  Korea.
• In May 2013, the Korea Times had reported that it
  is used by 75 of users having smartphones with
  smart wallet functions.

• Factors driving Success
• Timing of launch as it was first of its kind back
  then.
• The way it has been promoted to service
  providers. SK telecom highlights its large
  customer base as well as CRM capabilities to
  attract service providers.
• Positive perception by customers towards mobile
  wallet. They want a single medium to store
  multiple storage cards.
• Annual growth in payment cards at a CAGR of 8
  reaching volume upwards of 264 million back in
  2011. The surge in card ownership increased
  access to banking services which further
  increased mobile wallet adoption.
• Operators forging partnerships with banks and
  payment networks. E.g. SK telecom partnering with
  card issues to support both PayPass and payWave
  standards.

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NTT Docomos Osaifu-Keitai in Japan

• Factors driving Success
• The FeliCa platform helped it grow exponentially
  in Japan.
• But the major factor attributed to its success
  can be NTT Docomo being the market leader in
  Japan among mobile operators.
• Although the mobile wallet service has brought
  about other players as well including banks and
  has witnessed collaborative models as well.
• Very high penetration of mobile phones in Japan
  at around 87.
• Early adoption of mobile internet in Japan. E.g.
  i-mode, the mobile internet service by NTT
  Docomo, largest operator in Japan.
• Early adoption of prominent cellular technologies
  in Japan like 3G and 4G.

• Generic Information
• The words Osaifu-Keitai literally mean Wallet
  Mobile.
• The mobile wallet service was launched way back
  in 2004.
• It is based on FeliCa integrated circuit
  developed by Sony which is a de facto standard in
  Japan.
• Osaifu-Keitai include array of services like
  loyalty card, identity card, electronic money,
  public transit and credit card as well.
• The mobile wallet gets advantage from the FeliCa
  platform to integrate contactless payment
  technologies like NFC, QR code, etc.

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WyWallet in Sweden

• Generic Information
• The wallet service was founded in October 2011 by
  four major mobile operators in Sweden Telia,
  Tele2, Telenor and 3.
• It paved the way for 97 of Swedish mobile phone
  users to pay for goods at participating
  businesses.
• It uses the simple SMS platform for transactions
  using a mobile app.
• This enables it to function not only on Android
  and iOS smartphones but also on older phones
  based on Java.
• WyWallet provides a popular payment mechanism
  called purchase-on-invoice.
• This mechanism facilitates card-not-present (CNP)
  transactions in which customer can inspect
  purchase upon receipt and pay for them later.

• Factors driving Success
• The simple SMS platform makes it mobile OS
  agnostic and has been a key factor behind its
  wide scale adoption.
• The major reason behind its large customer base
  is the collaboration of the four operators which
  themselves hold majority of cellular customer
  base.
• The collaboration among the operators has
  provided cross-operator interoperability and wide
  addressable market.
• High mobile penetration and mobile internet
  penetration in Sweden.
• In Sweden, internet penetration is 94, mobile
  penetration is 150 and mobile internet
  penetration is 92.7.

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Seamlesss SEQR in Europe

• Generic Information
• Founded in 2001, SEQR is a popular mobile wallet
  in Sweden and across Europe too.
• Seamless, a 12 year old company based in
  Stockholm, installs its system at the point of
  sale with comes with stickers containing either
  QR codes or having NFC capability.
• The SEQR app can be used to access the POS
  systems.
• The methodology of transaction involves use of
  card details and account numbers stored on
  Seamlesss servers which is matched with cashier
  identification code and value of transaction
  stored at checkout system.
• SEQR is completely independent of PCI and
  traditional card networks.
• The service is currently active across 30
  countries with Seamless handling more than 3.1
  billion transactions.

• Factors driving Success
• The launch of the service in early years of the
  millennium gave it wide geographical reach.
• The independence on PCI and traditional card
  networks has given it wide-scale reachability.
• The lower transactions charges compared to card
  companies is also an influencing factor behind
  adoption.
• Effective distribution of sale outlets across 30
  countries, the no of outlets being 525,000.
• Highly developed telecommunications equipment and
  handsets manufacturing across Europe.
• Strong collaboration between payment service
  providers and banks. E.g. PBS in Denmark, BBS in
  Norway Luottokunta in Finland.

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T-Mobiles MyWallet in Poland

• Generic Information
• It started as commercial NFC payment service back
  in October 2012 in collaboration with MasterCard.
  
• The service was launched with the participation
  of banks and allowed customers of T-Mobile to
  store credit and debit cards on their phones.
  Within a couple of months of its launch, it had
  already gained 5,500 NFC customers.
• Currently, it works in collaboration with five
  major banks of Poland namely Eurobank, Raiffeisen
  Polbank, mBank, Getin and Noble Bank.

• Factors driving Success
• The collaboration with major banks of Poland has
  fueled MyWallets growth.
• At the end of first quarter of 2013, there were
  120,000 NFC point-of-sales in Poland which
  further aided the adoption of MyWallet.
• The high number of NFC portals can be attributed
  to MasterCard project towards deployment of its
  PayPass technology.
• With MasterCard collaboration in tow and the
  support of five major banks of Poland, MyWallet
  truly is on a successful roadmap.

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Rogers Suretap in Canada

• Generic Information
• In 2012, the mobile wallet came into existence as
  first of its kind collaboration between the
  Canadas biggest wireless carriers i.e. Rogers
  Communications Inc. and Canadian Imperial Bank of
  Commerce, among the five largest banks of Canada.
• It allowed contactless purchases up to C50 using
  NFC-capable devices.
• The mobile wallet service was SIM based and
  allowed payment card information to be securely
  downloaded to the SIM card.
• Suretap was readily compatible at numerous
  point-of-sales (POS) including those of
  MasterCard PayPass and Visa wavePay.

• Factors driving Success
• Rogers had a large subscriber base (9 million as
  of 2012) and also Rogers got its banking license
  approved in 2013 which propelled easy adoption of
  surretap.
• The SIM based feature provided highest level of
  security and more control to the customer thus
  creating better perception among its adopters.
• Through collaboration with MasterCard, Rogers was
  able to bring about virtual Rogers prepaid
  MasterCard which further aided adoption of
  suretap mobile wallet.
• The Canadian market is dominated by debit card
  usage. Back in 2011, around 78.8 million cards
  were in circulation. With EMV adoption already in
  its final phases, this has paved way for mobile
  wallet.

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NTT Docomos iD In 2005, NTT Docomo invested
US1billion in Japans no. 2 credit card company
at that time. This resulted in the launch of
Docomos very own credit payment scheme called iD
in the month of December. At the same time,
DoCoMo also gave subscribers places to tap their
phones to pay with iD, investing tens of millions
of dollars more for minority stakes in
convenience store chains. The telco also fronted
the cost of contactless terminals for smaller
merchants. Through its tens of millions of U.S.
dollars worth of investment in retail chains,
DoCoMo has managed to get the iD m-payment brand
accepted at scores of convenience stores and
other merchant locations450,000 terminals in
all. The high penetration of FeliCa chip enabled
phones fueled the growth of the iD service.

• NTT Docomo and KTs NFC rollout
• Commercial NFC services were introduced by
  Japans NTT Docomo and South Koreas KT at end of
  2012.
• The services allowed subscribers to use a range
  of NFC mobile payments including mass transit
  ticketing, promotional couponing services, etc.
• Facilitated customers travelling between Japan
  and South Korea to access the services with no
  constrains.
• Further expansion of service through strategic
  tie-ups Visa Inc., Samsung Electronics Co. Ltd.
  and Gemalto.

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Other Wallets yet to see Sizeable Adoption
Isiss Mobile Wallet in USA Isis, the firm
behind this mobile wallet service, is a joint
venture between the three largest operators in
USA i.e. ATT Mobility, T-mobile USA and Verizon
Wireless. The mobile wallet service is thus
supported on more than 50 Isis Ready smartphones
under contract among the three operators. To use
the service, a consumer basically requires an NFC
capable smartphone and SIM based secure element.
In USA, more than 20 million smartphones in
market feature NFC technology with more being
shipped by the leading three carriers. Isis
mobile wallet has already had successful pilots
in states like Texas and Utah unveiling a no of
fruitful results. As many as 65 of consumers
testing the service revisited merchants often and
took advantages of mobile offers. Isis mobile
wallet has deals with four major credit card
companies Visa, MasterCard, American Express and
Discover. It has the support of six major handset
makers. Not to be forgotten is the backend
support of the leading cellular operators.
Recently it has partnered with big point-of-sale
system providers and financial institutions like
Chase, Capital One and Barclaycard leading to
incubation of more payment cards into Isis
wallet. Such deals have given access to about 50
of all consumers in USA.
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