M1 – BT
M1 to try out mobile payments
Telco partners Citibank and Visa in three-month pilot scheme
MOBILEONE has become the latest telco to dip its toes into the nascent market for mobile payments, with the launch of a trial to allow customers to tap-and-pay for everyday purchases with their handphones.
The trial, which starts in May, in partnership with Citibank and Visa, will allow 300 Citi M1 Platinum cardholders to whip out their phones instead of the usual plastic to pay for items at more than 750 retail outlets.
The payment function relies on near-field communications (NFC) – the same technology used on trains and buses to allow passengers to tap and pay for fares.
In the MobileOne trial, participants will be issued with an NFC-enabled handset that has been pre-loaded with Visa’s contactless payWave application.
The software links the phone to a Citibank M1 Platinum card account and allows the device to transmit this information to special payWave terminals at participating outlets such as The Coffee Connoisseur, Mrs Fields and Gramophone.
The Visa payWave system is touted to be able to halve transaction times and eliminates the need for a cardholder’s signature, making it suitable for making small, everyday purchases such as a cup of coffee, movie ticket or CD.
During the pilot scheme, cardholders can only use their handsets to pay for items costing less than $100. The same limit is being imposed on payWave transactions on the One Card by United Overseas Bank, the first local credit card to support Visa’s contactless payment technology when it debuted in 2007.
M1, Citibank and Visa are hoping to use their three-month experiment to assess the viability of phone payments in Singapore, as well as consumer preferences when using the tap-and-go system.
As a sweetener to get participants to open their mobile wallets, they will be allowed to keep their phones after the pilot scheme if they carry out more than eight transactions a month. The cost of the trial has not been disclosed.
The promise of phone payments has seen a renaissance in recent years as a result of explosive handset growth and the advent of technologies such as NFC.
With a sky-high mobile penetration rate of 131 per cent, Singapore is seen as a prime candidate for seeding mobile wallet projects.
‘This is Singapore’s first pilot of mobile payments linked to a credit card,’ John Denhof, Citibank Singapore’s business director of credit payment products, told reporters at a briefing yesterday.
The island’s top two telcos have experimented with NFC payment options in the past. StarHub, for example, partnered EZ-Link in 2007 to test the feasibility of using phones to pay for bus and MRT rides.
And in the same year, Singapore Telecom launched an NFC trial with Nets (Network for Electronic Transfers) which allowed phone payments at 500 participating outlets. However, these companies have not taken the next step of large-scale commercial rollout.
‘We want to be ahead of the curve when it gets adopted,’ Mr Denhof said.