There's a ton going on in Mobile Payments but it can get confusing very fast! For those interested but not close to it all - I put together a little 50,000' primer that I've used to explain the different approaches to Mobile Payments.

1. THE 50,000’!
PRIMER ON !
MOBILE
PAYMENTS!
KRIS ZANULDIN!
@kzanul!

2. WHAT IS MOBILE
PAYMENTS?!
Mobile Payments means different things to different people but
it’s all rapidly converging!
Online Payments!
In-store Payments!
What Is it?!
Using your mobile to shop
and pay online!
What Is it?!
Using your mobile to pay instore,
usually at a physical point of sale!
Key Capabilities!
One-click checkouts !
3-D secure!
Key Capabilities!
NFC / SE!
QR / Bar Codes
Check-in / Bluetooth!
Why Is It Important?!
Mobile is a rapidly growing
share of online commerce
traffic!
CONVERGENCE!
Why Is It Important?!
Value add functionality can be
added to the mobile
experience vs. traditional
plastic!

3. IN-STORE MOBILE PAYMENTS
IS A RAPIDLY EVOLVING BUT
FRAGMENTED SPACE!
Solutions have to balance customer disruption, merchant
disruption, security, convenience and cost. !
NFC Rails!
In-Store Over Cloud!
Magstripe with Mobile!
Card present payments
leveraging contactless
technology and secure
elements either through
embedded, SIM/UICC Card
or in the cloud.!
Card not present
payments that are
processed in the cloud
via an in-store initiation
method (e.g. QR/Bar
Code, Bluetooth/Checkin)
Card present payments
that leverage or emulate
traditional mag-stripe
technology on or in
conjunction with mobile to
take advantage of wide
acceptance!
!
Examples: Loop, Coin!
!
Examples: ISIS, RBC
Secure Cloud, Suretap!
Examples: PayPal Wallet,
Square Wallet, Starbucks!

4. NFC!
Leveraging the same contactless technology as plastic cards,
NFC enables a mobile to emulate a plastic contactless card.!
Pros!
Cons!
Key Terms!
•
Minimizes merchant
disruption by leveraging
existing contactless
terminals!
•
“Perso”-ing a mobile device
or cloud with secure
credentials for NFC is
complicated and expensive.!
•
TSM: Trusted Service Managers
that help distribute secure data
between the service providers
and secure element owners.!
•
Card Present EMV
transaction with similar
security to a Contactless
Chip Card!
•
Apple devices to-date do
not have NFC. Requires a
sleeve/MicroSD add-on.!
•
•
Lifecycle management and
maintenance of credentials
on the device adds
additional cost and
complexity.!
Secure Element: Tamper proof,
standalone element on the
phone (or cloud) that contains
payment credentials. Can be
owned by Mobile Operators,
OEM Manufacturers or Issuers
(Cloud)!
•
“Tap to pay” is a familiar
behavior that is easily
explained to customers!
4!

5. NFC Example: ISIS
• NFC wallet consortium
of AT&T, T-Mobile and
Verizon in the US.!
• Secure Element on the
SIM.!
• AMEX, Serve and
Chase payment cards
can be added to the
wallet.!
• Allows offers and loyalty
cards to also be loaded
to the wallet.!
5

6. IN-STORE THROUGH
THE CLOUD!
Payments are initiated in-store through the mobile but payment credentials are stored
and retrieved on the cloud which in turn will communicate with the merchant POS!
Initiation
Method!
QR /
Barcode!
!
Bluetooth!
/Check In!
Pros!
Cons!
Key Terms!
•
Easier lifecycle management
and setup with credentials
stored on the cloud vs. NFC.!
•
Disruptive for merchants
to adopt due to POS
integration requirements.!
•
Cloud Payments: Storing and
accessing payment credentials
in real time on the web.!
•
Depending on the initiation
method – can enable a
“hands free” payment
experience!
•
Card not present
payment which risks
higher fraud rates.!
•
•
Checkout experience
can be less intuitive and
more difficult to explain
vs. “tap to pay”.!
Bluetooth LE: Low power
wireless technology that exists
on most smartphones. Highly
flexible when used in
conjunction with applications
for proximity detection and low
size data transfer.!
6!
•
Apple devices can utilize
almost all of these initiation
methods.!

7. IN-STORE CLOUD EXAMPLE:
PAYPAL WALLET!
Customer “checks-in” to merchant via PayPal
app OR app automatically checks-in
Customer with PayPal Beacon proximity
detection (requires customer opt-in)!
At the POS, Merchant confirms Customer
and confirms order. Payment is made over
the cloud. !
Customer receives receipt over email or
SMS.!

8. BEACONS + CLOUD =
INTERESTING OPPORTUNITY!
Bluetooth LE (Smart) beacons allow applications to create
rules and experiences that are triggered based on highly
accurate proximity detection. These use cases can be flexible
and used for marketing, servicing and payments.!

9. MAKING MAG-STRIPE COOL!
Alternate payment methods are emerging that try to circumvent
the disruptions of newer technology be leveraging traditional
mag-stripe. Big short-term benefits but long term questions. !
LOOP!
COIN!
(Initial) Pros!
(Initial) Cons!
•
Widescale acceptance of mag-stripe
terminals and does not require any
additional merchant-side investment or
disruption.!
•
Outside of the US – most markets are
EMV. Terminal behavior when
encountering a mag-swipe could lead to
negative customer experiences.!
•
Easy and intuitive customer experiences
(swipe with Coin) or (tap with Loop).!
•
Security concerns on mag-stripe as
most of the industry has moved to EMV
9
and chip.!

10. THE FUTURE VALUE OF MOBILE
PAYMENTS IS NOT THE PAYMENT
ITSELF (MY OPINION)!
Mobile payments needs to extend its reach to include pre-purchase,
purchase and post-purchase use cases in a single experience.!
PURCHASE!
MARKETING &
SERVICE!
LOYALTY!

11. THANK YOU!!