Finger pay redux

A few people forwarded a link from Time Out to me last week, calling attention to a new payment mechanism using a new biometric identification technology to effect retail payments in a new way.

The latest in contactless payment – called Fingopay – uses a bartop scanner and allows customers to introduce their index finger when they’re ready to settle up. The unique patterns of the veins in each customer’s index finger – which need to be linked to their bank account in advance to make a payment possible – are electronically scanned on the spot in the aim of speeding up transactions at the bar.

From You can now pay for a pint using just your finger at a bar in Camden

I’m not sure if my repeated use of the adjective “new” in the introductory paragraph was entirely appropriate and I don’t want to be like all yeah whatever but… the first time that the technology was mentioned on this blog was almost exactly a decade ago, when I was talking about mass market uses of biometrics and the particular case study of Japanese banking, and it wasn’t new then.

Another group that includes Sumitomo Mitsui Banking Corp., Mizuho Bank and Japan Post use a similar system but it analyses fingertip vein patterns.

From Well, is this the year of biometrics? | Consult Hyperion (April 2007)

In addition to identifying customers at ATMs and Post Office counters the technology that they are referring to here, the Hitachi fingervein technology, has been used as an alternative to payment cards from its earliest incarnation.

Biometrics continue to advance in Japan with the news that Hitachi is teaming with Japanese issuer JCB to develop a biometric payment system based on its finger vein authentication technology that can be used as an alternative to cards and cash at the point of sale.

From Fingering suspects | Consult Hyperion (November 2007)

The technology has reappeared as a new solution to these same problems a great many times since then. It seems like every couple of years or so some stories about this new technology and new way to pay reappear. For example…

The BBC were kind enough to invite me on to their lunchtime “You and Yours” magazine programme to discuss this innovation. I think they were a tiny bit surprised, to be honest, when I told them that the technology was eight years old! I also told them, in the spirit of openness and integrity that is associated with the good name of Consult Hyperion throughout the civilised world, that we had been retained by Hitachi some years ago to carry out a study on the security of this product and its suitability for certain financial services applications.

From We’ll be giving Barclays the finger next year | Consult Hyperion

The truth is that this specific technology has been around for absolutely ages and the idea of using fingerprints as an alternative to payment cards at retail POS has been around for even longer. This from 2004:

The Piggly Wiggly grocery chain has announced it will begin offering a high-tech payment feature allowing customers in several stores to pay using their fingerprints.

From Grocery store goes to fingerprint payments

You can’t help but wonder what is different this time. Well, for one thing, we have PSD2. My memory of some earlier attempts may well be imperfect, but I have a vague recollection that these previous attempts at finger-based payments worked by tying the stored template to a card-on-file and then processing a card-not-present (CNP) transaction at POS (even though the cardholder was self-evidently present). Since the costs associated with CNP processing were much greater for the merchants, and the US was moving to no-signature stripe programs anyway because all of the terminals were online, the finger payments were slower and more expensive than stripe payments. Hence neither the merchants nor the consumers were greatly interested. Systems like this did make progress in closed environments (such as schools and prisons) but made no inroads into the mass market.

However, things are changing. We have strong customer authentication (SCA) and risk-based authentication at POS, we have interchange regulation and interchange plus acquiring in Europe and soon the retailers will be able to process payments themselves by obtaining payment institution (PI) licences and obtaining consumer consent for direct access to their bank accounts. Thus, putting your finger on a reader in store and having the retailer instruct an immediate instant payment transfer from your account to the retailer account looks like a more promising model this time around (but I have to say I am sceptical about traction in a world where consumers have mobile phones with them all the time and can obtain Internet connectivity even in Camden).

The decision to try out the new system in a pub, by the way, did bring on a wave of nostalgia. Here I am with my CHYP colleague Kate Hughes, my fellow Visa Business School instructor Joe Di Vanna and my old friend Mark Burgess testing out some early contactless products  in the bar at Robinson College, Cambridge. Joe claimed that he could do a cash transaction faster than contactless…

 

On a related topic, it is important to note that while fingerprints are unique, and all that, they are not without issue. For one thing, you leave your fingerprints everywhere you go. For another, you do not always have complete control over your fingers…

Wife exposed diplomat’s affair by using his thumb to unlock his iPhone while he was sleeping 

From Foreign office official ‘assaulted wife when she used thumb print to unlock iPhone’ exposing affair | Daily Mail Online

This is why those of us who understand security use Wickr or Signal to communicate with confidantes and always set a passcode for the application!  The point is that fingerprint security has failure modes and those could be exploited by any seven year old. Paging Groucho Marx: someone get me a seven year old…

7-year-old Harrison Green waited for his dad to fall asleep and then hovered his finger over the sensor, thus defeating his strong fingerprint encryption choice.

From 7-Year-Old Boy Uses Sleeping Dad’s Finger To Unlock iPhone

Having had a look through the Fingopay website, I notice a clever use of this particular feature (that is, the ability to use the biometric identifier without the consent of the owner).

We have developed an “in-case-of-emergency” ICE system that can be used to assist in identifying you even if you are unconscious

From – FAQs –

This might be more of a use case in Camden on a Friday night than a new payment mechanism! I suggest they also try my alternative solution which is to store a revocable token in tamper-resistant hardware and use the biometric for strong local authentication of that token. If people in Camden really don’t want to take even a card down the boozer, and are worried about waving a phone around because it’ll get half-inched at chucking out time, well, our friends on the continent have a tried and tested alternative.

everyone’s current favourite case study for this sort of thing is the Baja Beach nightclub in Barcelona, where patrons were offered the choice between a card and a chip and some of them chose the chip… The chips are the size of a grain of rice  (1.2 millimetres wide and 12 millimetres long) and injected (by a “medically trained” person, according to the New Scientist) under the skin in the upper left arm. 

From Chip ’em all | Consult Hyperion

One of my favourite conference jokes a decade ago (first used in a presentation to the International Association for Biometrics in September 2004) was that the chip is better than a card because you really can’t leave home without it. Now, to be honest, I’d prefer an implanted chip like that to biometric identification. Why? Well, the chip contains an ID number and no personally-identifiable information (PII). If some unauthorised person scans the chip, all they get is an ID number. If I use an app on my phone to allow a particular retailer the ability to charge against that ID number at specific times, or only with strong authentication (e.g., a PIN or a fingerprint or whatever), that seems both convenient and secure.

If you’re too squeamish to have a chip implanted (I’m not – in fact I begged them to implant one on stage at a Consult Hyperion Forum but they wouldn’t do it because the chips were not licensed for use on people in the UK) then there’s an alternative I can suggest. One of my favourite conference jokes right now is that you can always have a QR code tattooed on to some part of your body. Private key vs. privates key* (geddit!).

 biometric payments

* If you know a better PKI-related joke I am literally all ears.

WTF USA EMV CVM POS PIN SNAFU

I’ve been reading a lot of comment about the US EMV migration recently and there seems to be pretty universal condemnation of the process (some of it from me). In the UK, we had chip and PIN day (St.Valentine’s Day 2006) and that, pretty much, was that. But in the US, the migration has been piecemeal, confusing and fraught with problems. But why?

Critics have told me that banks opted for a signature versus a PIN code because it saves them large amounts of money by not having to store PIN codes for everyone. Banks, on the other hand, say they feared that their customers would have a difficult time remembering a four digit code.

From The EMV chip credit card transition in the US has been a disaster — Quartz

As far as I know, neither of these is true. Some issuers preferred chip and signature because it has higher interchange, not because US consumers are morons who uniquely amongst the nations of the Earth cannot remember a four digit personal identification number (PIN) that they use several times every day. Merchants wanted PIN because the fraud rate on PIN is two orders of magnitude less than with signature. Consumers wanted speed and, since they were given that by the no-signature online-authorised stripe transactions that they were familiar with, there was no traction for contactless (which delivers speed and convenience in an EMV environment and provides fertile ground for mobile payments).

The typical US consumer approaches a POS with some trepidation, I imagine, since it is completely opaque as to the experience that awaits them. Tap, swipe, dip, PIN or sign, hand over the card or keep it… every transaction is an adventure. I suppose many stakeholders take the position that it doesn’t really matter because mobile and in-app are going to steadily erode card transactions (Jupiter is reporting that almost half of US consumers already use some form of contactless payment, and a fifth already use it every day – mostly Starbucks I’d imagine). At some point in the imaginable future, “tap and pay” and “app and pay” will together exceed both EMV and magnetic stripe transactions at retail point of sale (POS) and at this point (the plastic singularity or, as I prefer it, #cardmaggedon or the #cardocalypse) signature versus PIN will seem to our children something of a medieval argument along the lines of angels on the head of a PIN. Right now, though, it is still a live debate.

My own decidedly unscientific survey involved a shopping spree one recent morning to no fewer than seven different retail locations, which revealed exactly seven different chip-capable payment terminals instructing customers to “Please Swipe Card.”

From The Great EMV Fake-Out: No Chip For You! — Krebs on Security

However, until such time, we should probably make an effort to improve the user experience (UX) for the typical consumer and make cards work better for the merchants. As I recall from the excellent NYPAY discussion on the topic, US merchants are particularly aggrieved by the rise in chargebacks that they have seen over the past few months.

Chargebacks for card-present transactions increased 50% following the Oct. 1 EMV liability shift,

From EMV Chargebacks Proving To Be a Card-Present Merchant Problem

You understand why this, I’m sure. It’s because before 1st October, if you spotted a $3.95 charge at Starbucks on your statement and you knew that you couldn’t possibly have made that transaction, then you would call up your issuer and complain and they would just eat the charge because it would have been more trouble than it’s worth to go back to Starbucks, pull the receipt, check the signature if there was one etc etc. However, after 1st October, if you spot a bogus $3.95 charge on your account and call up, the issuer will check the transaction codes and, if you had a chip card but it was swiped by a merchant who didn’t have (or didn’t use) a chip reader, then the $3.95 is charged back to the merchant. The net result is — entirely as expected and as it should be — that merchants see big increases in card-present chargebacks as previously hidden magnetic stripe fraud is revealed.

A good way to reduce that previously hidden fraud would be to simply give customers the option to block magnetic stripe transactions from cards with a chip on them. Why are the banks not giving consumers the option to disable stripe transactions? My debit card has embossing and a magnetic stripe on it for absolutely no reason that I can fathom since I never use it a non-chip ATM and in practice I don’t need it when abroad. I’ve just returned from trips to Rome and Munich where I never once used cash and never needed an ATM (I used my Caxton FX pre-paid card in shops and ticket machines and I used Uber for transport).

Brit abroad

Proof that I was in Rome and that it’s not empty blog rhetoric.

I want my bank to auto-decline any magnetic stripe transaction made using my chip-enabled contactless debit card and I want the ability to set that parameter from my excellent mobile banking app. Why is this so difficult? Meanwhile, back in the US, the mounting annoyance with chip and PIN continues. Perhaps it’s time for the networks to announce the sunset date for magnetic stripes: perhaps 1st January 2019, after which time no new cards will be issued with magnetic stripes or embossing?

Retailer pressures for direct-to-account payments

Back in the October edition of “Digital Transactions” there was a nice column by George Warfal from our friends at Edgar Dunn called “The Next Way to Pay” in which he says that “merchants are re-purposing their rewards cards as payment cards using the automated clearing house and gaining per transaction savings”. He goes on to say that this mode of operation presents a challenge to the current card network model, and I’m sure he’s right. In fact, if you take a look at the latest figures from the US ACH, you can see an explosion in the account-to-account (P2P) payments which, I think, is related to growth in mobile app-instructed transfers.

US ACH

As you can see, all categories of ACH transfer are growing, with the exception of the check-replacement volumes that continue to fall (including at POS), as you might expect. I expect this trend to be even more marked in Europe, where the arrival of PSD2 means that retailer direct access to payment accounts will be one of the defining trends of the next era of payment evolution.

Under PSD2 banks and other payment service providers (PSPs) must give so-called payment initiation service providers (PISPs) access to their customers’ accounts so as to facilitate transactions ordered at the customers’ request.

[From Expert predicts innovation in payments market after PSD2 reforms are finalised]

I wrote an article exploring this for the Electronic Payments Law & Policy newsletter, arguing that while banks have been rather nervous about the effects of the access-to-account provisions of PSD2, it is time for them to adopt a more positive strategy, disrupting themselves before others do so. One suggestion, therefore, might well be for the banks to create their own access-to-account payment service, a sort of next generation debit product.

The recent EUR21.2 billion deal agreed between Visa Inc and European banks over the sale of Visa Europe has led to increased calls for the banking industry to put the windfall to use to create a competing product to tackle the duopoly enjoyed by Visa and MasterCard.

[From Finextra: Finextra news: Visa/MasterCard EU dominance adds impetus to calls for bank-backed competitor]

Now, Visa and MasterCard are rather good at what they do, so it would really take something special to be better at it than them. It might, in some observers’ calculation, be better to focus on delivering products into new channels where Visa and MasterCard have to work harder, such as mobile and online. Creating a direct-to-account service, with appropriate security and consumer protection, delivered through the EBA Digital Customer Service Interface (DCSI) as an API for retailers and other service providers to use, could deliver a worthwhile new payment product that (rather crucially) keeps the information relating to the transaction under bank control.

The European Payments Council has released proposals for the design of a pan-European instant credit transfer scheme, with the aim of bringing real-time money transfers across the Sinlge Euro Payments Area (Sepa) by November 2017.

[From Finextra: Finextra news: EPC publishes proposals for pan-European instant payments scheme]

This is pretty interesting. API access to a pan-European instant payments networks would mean a really important new “push platform” for product and service innovation in the payment space. If George is correct about the pressure from retailers to move to direct to account solutions, then I can see that there will be plenty of new opportunities for services in that environment: banks can offer real-time, API-centric, value-added payment services that offer specific functionality for retailers.

The user experience will make, or break, mobile payments

Being a keen consumer of baked pastry goods, and having a firm desire to see the pieces of plastic & cardboard in my wallet transferred to my phone, you can understand my excitement when the award-winning Greggs Rewards app was released early in 2014. The app combines the processes of payment, loyalty, and rewards into a single interaction at the point of sale, with a prepaid payment account which can be automatically topped up via credit card or PayPal. In eager anticipation of a tasty lunchtime treat, I therefore ventured out of the office and off to the town centre.

My first expedition ended in disappointment. In order to perform a transaction the customer opens the app, presses the ‘spend now’ button, and receives a dynamically generated token (an eight digit number) which is to be presented to the POS in the form of a QR code. But… in order to receive the token, I had to have a network connection. Now, whilst there is a very good network connection all the way up to the front door of the store, once through the doors my phone decided to connect to “The Cloud”.  For some reason, my phone has an on-off relationship with “The Cloud” and, it appears, its relationship with this particular hotspot appears to be more ‘off’ than ‘on’.  No matter, I can turn WiFi off. But what’s this? It appears that my mobile network didn’t share my longing for a sausage roll and decided to only let the GPRS signal through the door. It turns out that GPRS, whilst a revelation 15 years ago, does not appear to offer a particularly suitable channel for today’s mobile apps. Unable to obtain a token, I resorted to my plastic card.

Armed with this knowledge, I anticipated a successful second visit. This time, not only did I press the button to obtain the token before I got anywhere near the store, but I also took a screenshot of the QR code just in case. Ready to pay, and having got past the inevitable learning curve for the checkout operator who hadn’t been shown what to do with this new scheme, I was ready to finally scan my code – except that this store didn’t have any scanners at that time. So instead, I had to enter the 8 digit number on the keypad of the card reader. Happily, once the POS had my token, everything else went smoothly. I had redeemed an offer for a free item, paid for the outstanding items, and had a coffee loyalty purchase recorded all in a single interaction.

“But hang on,” I remember thinking, “they already accept contactless cards.  And I have an NFC phone which can talk to their readers. Wouldn’t it be great if the app could do NFC?”

Well, sixteen months later, and Greggs Rewards has now quietly added support for contactless in its Android app. Full of even more excitement than last February (well, I have been waiting for two years to pay for something by NFC) I headed out.

Having informed the operator that I would be paying with my phone, I was interested to note that she enabled the terminal for ‘card’ payment and not ‘rewards’ payment. Having seen that the app requires at least Android 4.4, and so concluding that it must be using Host Card Emulation (HCE), I was hopeful that this meant that it was seamlessly integrated into the ‘normal’ payment process.

Alas, the terminal was actually expecting a payment card and so the transaction failed. The operator told me that, when I had waved my phone at her, she had automatically assumed it was a contactless payment (which, as an aside, is actually good news for this month’s Apple Pay launch.)  It turns out that trying to integrate everything into a more seamless experience means impacting the existing card payment certifications, so for now they’re stuck with having to tell the POS what type of payment it should be expecting in advance.

Using the rewards app, even over contactless, still requires the operator to press the a special “rewards” button on the POS. This she did, and the contactless reader was ready to read my phone, the barcode reader was ready to scan my QR, and the terminal was ready for me to type in the number.

Unfortunately, this was the moment my phone decided it no longer wanted to play. With me having accidentally switched apps, on re-opening the Greggs app it decided it needed to connect back ‘home’ again. Because I hadn’t disabled WiFi, I was at the mercy of my phone’s long-term “It’s Complicated” relationship with The Cloud and so unable to provide the token. After disabling the WiFi, restarting the app (which for some reason was complaining that the 4G connection my phone now had was ‘too slow’), inwardly cringing at the complaints from the lengthening queue behind, and ignoring my colleague’s offer to just hand over some cash to get us out of there, I finally performed my first real world NFC transaction and was the proud owner of a free doughnut.

So what can we take away from all this?  Firstly, the mobile app must not rely on hardware or OS services that are not absolutely critical. Reliance on network connections is understandable for e-commerce, or for refreshing the app content, but for a POS transaction the app must be able to work without one – even if it is using dynamic tokens. The card schemes have already worked this out and catered for it in their HCE specifications.

Secondly, the payment experience must be seamless. It is frustrating to be a customer trying to explain a company’s mobile offering to the checkout operator, especially when the payment terminals are adorned with collateral advertising that very scheme. “Why,” I ask wearing the hat of a less well-informed member of the public, “can the till not work out for itself what payment method is being presented to it?  I don’t know about payment certifications and the resulting workarounds; I only care that the process is more complicated than it seems it should be.”

Only those of us with an unnatural interest in mobile payments (or a hearty appetite for pasties) will put up with a poor user experience more than once.  Normal people will give up and uninstall the app if it doesn’t work flawlessly; the people waiting in the resulting queue – such as the woman behind me who observed that “this is ridiculous” are unlikely to try it even that once.

Zapp could be a window into a “third scheme”

Down at Cards and Payments Australia in Melbourne I sat in on some interesting discussions about the coming Aussie immediate settlement system, the New Payments Platform (NPP, their more advanced version of the UK’s Faster Payment Service, FPS) and the kind of “overlay services” that might be built on top of it.

NPP Panel

While I was listening to this discussion, I remembered that a couple of years ago at a Smart Payment Forum in the UK, my old chum Adrian Cannon gave an update on the state of the UK FPS and said that in his opinion there would be an FPS point-of-sale service in the UK within five years. I agreed with him and referred to something I wrote back in 2007.

The mobile handset is the obvious means to implement secure, authenticated payments. I go to a shop, buy something, wave my phone over the POS, the bill shows up on my phone, I enter my PIN to pay it and my phones instructs an FPS transfer.

[From Digital Money: Changes to the card payments landscape in Europe]

Now, as Adrian predicted, there is an FPS-at-retail scheme under development in the UK and I am very interested to see how this develops because I have long thought that payments in general will be subject to a shift from pull to push. There are a great many reasons why a push-only payment solution is much better suited to the modern world, doing away with the 1970s hacks of direct debits and standing orders. With ubiquitous networks, smart devices and strong authentication we don’t need these any more.

Pingit and Zapp are both examples of “push” payment systems, ultimately controlled by the payer, in contrast to direct debits, which “pull” payments from your bank account. “It reverses the system,” says Mr Yates, “and puts the payer in control.”

[From Mobile apps boost payment security – FT.com]

The retail venture, Zapp, will launch this year (Before I get any e-mails on the topic: Consult Hyperion has provided paid professional services with the last year) and there is some pretty serious money behind it.

VocaLink – owned by the banks – has invested heavily its venture, recently putting in another £17 million on top of an initial outlay of £16 million. However, Zapp says that it is still hoping to attract outside investment as it bids to secure a total of around £100 million to bring the service to launch, with much of the money earmarked for an aggressive marketing campaign.

[From Finextra: M-commerce start-up Zapp vows to take on Visa and MasterCard]

So why is this so important? Well, as I heard several people say in the context of the Australian discussion, an immediate settlement overlay is a new and very different proposition for retail payments and rather than be used simply to emulate existing infrastructure (potentially at lower cost) it ought to be used to enable new products and services, to create transactional infrastructure that does not currently exist.

Furthermore, if a mass market mobile payments initiative takes place which does not use the traditional rails, and is instead based on the Faster Payments system, it will have considerable ramifications for the UK payments market at large.

[From Zapp Vs Pingit – the creation of the UK’s 3rd debit scheme? – Payments Cards & Mobile]

Actually, I would say the ramifications are for Europe at large, because the idea of a European “third scheme” might well make more sense as a layer on top of a pan-European immediate settlement service (perhaps an evolution of MyBank) rather than a derivative four-party Visa/MC lookalike. The idea of a super-simplified push-only instant payment service is appealing to many stakeholders (I’ll blog about this some more in the near future) and it seems to me that from the European Commission perspective this sort of service – based on what we at Consult Hyperion have been calling the “triple-A play” of authentication, apps and APIs – it could be an attractive platform for innovation.

Another report on falling cash usage in the UK

My son and I have been out and about, living the life of normal folk who don’t care about payments. We made a couple of cash payments and we made a couple of non-cash payments. We didn’t, however, make any chip and PIN or contactless or swipe payments.

The Halifax, part of the Lloyds Banking Group, just released some interesting figures about trends in customer use of payments. One of the more noticeable trends is the steady fall in the use of cash, a fact that was picked up on by a a number of news outlets.

“Cash withdrawals now account for just £18.33 of every £100 spent, a £1.82 decline since 2013.”

This got me on to BBC Wake Up To Money and subsequently a number of other BBC Radio interviews about the rise of electronic payments and the decline of cash. One of the questions I was asked was about places where you have to use cash. I couldn’t think of one off the top of my head. I was thinking of using the example of giving money to beggar in the street (which I never do, I but I’ve heard of the phenomenon), but then I remembered that beggars are ahead of this particular curve.

“A professional beggar who travels hundreds of miles from his home in Lancashire to London’s Mayfair has been using a credit card reader to accept payments from wealthy tourists. Damien Preston-Booth, 37, commutes from his rented home in the north-west, but pretends to be homeless when he asks passers-by for money on the streets of London. As well as taking cash from wealthy tourists in the exclusive Mayfair area, he also has a mobile card reader and accepts payments to his PayPal account.”

I think this is pretty forward-thinking of him, and despite the underhand nature of his enterprise, applaud his willingness to try exciting new forms of payments at the heart of Europe’s FinTech capital.

“The reader is linked by Bluetooth to his smartphone and the donor receives a receipt for the donation via email.”

If you want to donate to another worthy cause, the Dave Birch Holiday Home in the South of France Emergency Appeal, you can PingIt the money to @dgwbirch and I will, of course, be only to happy to e-mail you a receipt on request. But back to the point. Where do you have to use cash? On one of the shows (I apologise for forgetting which one) someone said that they had to pay cash at they local Chinese restaurant. This made me wonder: why do people go to cash-only restaurants? Apparently I’m not the only person that thinks about this.

“Either we didn’t know it was cash-only, and are now furious about this fact for all the reasons examined above; or we did know it was cash-only, and we chose it anyway because it made us feel bohemian, in-the-know, and capital-C Cool.”

Yeah, well. I don’t buy the hipster curve on this. If I am out for lunch and I see a restaurant with “cash only” in big letters on the door then I will walk straight past it. The only reason that I’ll go in is because they don’t tell you they are cash-only until it is too late. I have the same problem with taxis. I suddenly decide to hail a black because I’m in a street full of them and so can’t be bothered to use Hailo or Uber or whatever. So I put my arm out, the cab stops, I jump in and… I see a sign saying “cash only”.

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At that point I should of course tell the driver to stop and let me out, but because I’m English I find it very difficult to do that and so instead sit fuming in the back until we approach my destination and then jump out to run to an ATM. It looks as if some other drivers recognise and anticipate that problem too, because it’s presumably a problem for them that the machines often have only £10 and £20 notes in them.

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In a modern city such as London, this is unacceptable. Either ban taxis from cash-only operation or make them paint the cash-only taxis a different colour so that normal law-abiding citizens can avoid hailing them. Anyway: it’s a minor point. Hailo, Uber and whatever mean that none of us will be hailing taxis for very much longer and #appandpay will again triumph over #tapandpay. Meanwhile, still scratching my head about where I might last have used cash, I remembered my day out in Woking last week. I picked up my son from his friend’s house, where he regaled me with (quite unprompted) tales of his night out at Wagamama in Camberley, where he tried out their nearly new QKR! implementation. He loved it, and thought that the #appandpay convenience of the service was an absolute winner. Why wait for a server to come over to the table with a chip and PIN machine when you can just pay via the app and go?

17017663092_3c48b29b28_m

He was telling me this as we were strolling down to check out Woking’s newest wargamesshop, the excellent “ibuywargames”. Having had a look around and decided to buy a couple of things, I noticed a PayPal chip and PIN reader in the store. I took this to mean that they would accept all forms of PayPal so, since I had my phone in my hand but my cards were in my wallet, we both fired up PayPal and I paid in-app. Another #appandpay triumph, but this time over #chipandpay. So, no need for cash there either.

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But then I remembered: I did use cash after all that day. We stopped for a burrito at the truly fabulous Aracelis stall in the old Woking market. I was lured there by my son’s tales of their fantastic Mexican food. I am sorry to report that when I got there I found that they were cash-only, so I was about to walk away on principle but my son forced me to suppress my conscience and order. It was amazing. All they need is a contactless reader and I might never leave.

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The point here is that one of the key reasons why cash is in decline for retail transactions (as I mentioned on several radio stations) is the rise of the mobile phone as a alternative not only to the card but also to the terminal. As has been observed here many times before, it is the mobile phone (rather than the plastic card) that it is leading down the road to cashlessness, and this is the point I wanted to reinforce. Oh, and that half of the payment experiences I’ve spoken about here were in-app.

These are the personal opinions of Consult Hyperion and its guests and should not be misunderstood as representing the opinion of its clients or suppliers. To discuss how any of the technologies discussed in this post can benefit your business, please contact Consult Hyperion.

Another report on falling cash usage in the UK

Dgwb blog white border

My son and I have been out and about, living the life of normal folk who don’t care about payments. We made a couple of cash payments and we made a couple of non-cash payments. We didn’t, however, make any chip and PIN or contactless or swipe payments.


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