The BBC’s Money Box programme had a report about the RBS/MasterCard pilot of PayPass contactless debit cards in Edinburgh. I heard it on the radio on Sunday evening. The report was, I have to say, very positive. It definitely reinforced my feeling that something different is happening in retail electronic payments.
The one concern that was expressed by an interviewee was security, but the use of the extended EMV risk management parameters (eg, the offline “noCVM” counter) appeared sufficient to overcome the fears. Yes, I know the general public aren’t especially familiar with EMV risk management parameters, but they were interviewing bank staff who had been using the contactless debit cards.
One of the people they interviewed, who was very positive about the trial, was the manager of Starbucks and another catering operation involved in the pilot. He was very enthusiastic about the pilot and the results so far. One of his points is worth repeating here: one of the reasons he was so keen on the use of contactless to replace cash was that it tackles some of the evaporation of cash that’s a problem in his kind of operation. So his business case wasn’t just about speeding people through a checkout line when they are buying sandwiches, but about cutting into (is this the correct, quaint retailing term?) “shrinkage”.
He also said that the average transaction time for customers using the contactless cards was half that of cash, which is consistent with the results coming back from US markets where customers have been using the technology.
Blog readers will be aware that Starbucks finally introduced contactless payments a few weeks ago, making it a reasonable seven years from this pilot to deployment!
These are personal opinions and should not be misunderstood as representing the opinions of
Consult Hyperion or any of its clients or suppliers