Westpac outlines payments strategy at MasterPass NZ launch

Westpac outlines payments strategy at MasterPass NZ launch

Summary: Westpac NZ charts its own payments path, adopting MasterCard's MasterPass digital wallet ahead of its Australian parent.

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MasterCard has launched its MasterPass e-commerce payments wallet in New Zealand with Westpac as its first bank partner. However, for Westpac NZ MasterPass is just the beginning.

The bank's chief product officer, Shane Howell, said MasterPass is "one big platform" to enable digital wallet functionality for Westpac NZ's customers.

At launch the bank will use the white label version of the product, hosted by MasterCard, but as usage grows may shift to its own installation. That is because market research shows customer want their digital wallets to be supplied by their main banking provider, MasterCard's Australasian head of market development and innovation Matthew Barr said.

Meanwhile, Westpac NZ has four other payment technologies in development or trial.

Firstly, the bank has issued Near Field Communications (NFC) stickers to 500 customers and is trialing those. The stickers, which adhere to the back of the phone, contain a chip that is provisioned with payment card details. Transactions unnder NZ$80 are automatic while anything over that amount requires PIN code authorisation.

Second, Westpac is trialing Bluetooth Beacon technology in one local branch. Beacon, which is being used internationally by PayPal, allows a store to identify customers when they enter the premises.

Howell said Beacon will allow the creation of different kinds of payment experiences for customers at point of sale. It could, for instance, provide better customer knowledge and potentially improved loyalty programs and offers.

It can also act like a CRM system, prepopulating computer screens in the store to speed customer service. Howell said in a bank branch other forms of identification are still required.

Third, Westpac is also looking at Hosted Card Emulation (HCE), where NFC is delivered via the cloud. instead of programming NFC data into the SIM if the phone, credit card details are held in the cloud and accessed wirelessly.

Howell said this provides the same functionality as Trusted Service Manager (TSM) in SIM-based NFC but on a very different model.

Credit card details are not held on the handset. Users don't have to rely on telcos to provision their details to the SIM or the handset.

"I'm a big fan of the cloud," he said, adding that the HCE is a lot simpler and can integrate better with wallets such as MasterPass.

Fourth, Westpac is engaging app developers through app challenges to find other innovative solutions to providing "payment choices anywhere, anytime".

"We don't have all the answers and the pace of change is phenomenal," Howell said.

Westpac's surveys indicate already 54% of customers are ready and willing to undertake any transaction type via their mobile.

"We have a lot fo work to do," he said.

MasterCard's MasterPass has been launched in over 20 countries to date and has 40,000 online merchants now using it.

However, while Commonwealth Bank, NAB and their subsidiaries have adopted MasterPass in Australia, Westpac there has yet to do so.

The system allows shoppers to enter their credit card details once only to transact quickly and securely with merchants online, MasterCard says. That can reduce online shopping cart abandonment before purchase.

David Galt, CEO of travel retailer WebJet in Australia and New Zealand, said customers often do their travel research on the couch via a tablet. MasterPass allows them to complete the transaction without getting up to hunt down their credit card and reenter their information.

MasterPass does not just accept MasterCard. Visa and other credit cards are also supported.

Along with Westpac, several payment gateway providers have already implemented MasterPass in New Zealand meaning around 100 local merchats are already offering the service, MasterCard NZ country manager Peter Chisnall said.

MasterPass is one of several digital wallet technologies now vying for market share. For instance, Visa offer V.Me and last October Amazon began offering its own wallet more broadly to online retailers. Giants such as Google and others are also entering the space.

Topics: New Zealand, E-Commerce, Mobility

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  • Keep these MasterCard/Visa digital wallets generic ...

    “market research shows customer [wot, only one?] want their digital wallets to be supplied by their main banking provider”—MasterCard's Matthew Barr.

    I simply don’t believe it; we all have been using MasterCard and Visa credit cards now for many years; the loyalty/security is in the MasterCard and Visa brands, not the individual retail bank, and in most cases the bank branding is barely noticeable; it’s a MasterCard or a Visa brand that is accepted around the world, not the individual issuing bank!

    This “branding” is marketing madness in the extreme, and that is demonstrated in CommBank’s branding of MasterPass as “CommBank Checkout”, with a convoluted registration process that failed when I tried to register my MasterCard thereon. Twelve months after MasterCard launched “MasterPass” I have not seen “MasterPass” or “CommBank Checkout” on even one online site! I have seen and used Visa’s generic “V.me” on the DealsDirect.com.au site; registration was as simple as it could possibly be. Both these digital wallet products should be left generic as are the underlying cards virtually, and the registration process kept simple, as it is with “V.me” …

    In the final analysis, there are only two “professional” digital wallets, MasterCard’s “MasterPass” and Visa’s “V.me”; all the others are clunky middlemen operating via Credit Card Merchant Accounts with their own retail banker and, indeed, riding—precariously—on the backs of MasterCard and Visa …
    Philip Cohen