The interest of established tech corporations in making mobile payment systems commonplace led to each company having its own service: Google has Android Pay, Samsung developed Samsung Pay and Apple offers Apple Pay.
The simplified method means that customers can make quick and cashless purchases by simply using their smartphones at the checkout terminals of stores. However, one essential player in the transaction was omitted by the tech giants when setting up their payment services: banks.
In the United States, only the tech forward of users adopted the mobile payments, which gives banks a chance to catch up.
Capital One is the first bank in the U.S. to launch a mobile app with tap-to-pay, NFC embedded functionality. NFC, an acronym for near field communication, is the same system Google and Apple use for their mobile transactions. Samsung has the advantage of using NFC and MST (Magnetic Secure Transmission), which broadens the market niche covered by the South-Korean electronics producer.
Banks can win from mobile payments because each time a customer uses his credit card, the bank gets a small fee. Some traditional, less tech savvy buyers tend to trust their banks more than tech companies, leading to the deceleration of Apple Pay, Android Pay or Samsung Pay. Apple's business model ensures that every time Apple Pay is used, the company receives a fee. In contrast, Google and Samsung receive zero financial compensation for mobile transactions done with their respective apps.
One way Samsung plans to change this situation is by charging shops that deliver special deals using the app.
It is worth mentioning that banks are facing a problem when approaching the iOS ecosystem. Even if the iPhone supports NFC capability, the Cupertino-based company firmly controls who uses it. This simply means that Apple Pay is the only software that can access the NFC function of the iPhone. Although not impossible, it is unlikely that Apple will soon allow banks to use its NFC capability.
With so many easy, instant ways of purchasing goods, the competition between mobile payment providers grows stronger. If the future reserves an in-depth integration between mobile companies and banking institutions remains to be seen.