U.S. Bank Exec Urges Banks to Make ‘Lots of Small Bets’ in M-Payments (March 12, 2013)
March 12, 2013
Banks looking to devise mobile payments strategies must go against cautious traditions and begin experimenting with a variety of mobile wallet and mobile payment approaches at once without worrying about success or failure, a panel of experts advised a standing-room-only crowd on Mon., March 11 in a session about the future of banks and mobile payments at BAI Payments Connect in Phoenix. “It makes sense for banks to support more than one [mobile payments] platform,” said Brad Greene, a Visa Inc. senior business leader. “The most important consideration will be scale,” he added, noting that consumers will likely embrace several “broad-based wallet” schemes.
Amid the chaos of mobile payments innovation, making “a lot of small bets” versus one big one is the way to go, said Todder Moning, vice president, retail payments solutions, U.S. Bank. “Some of [these experiments] are probably going to work out” and all of them help banks gather important data about consumer preferences for mobile payment concepts as they evolve, he suggested.
Even banks that haven’t yet formulated a mobile payments strategy are sitting on valuable mobile payments data they can use, said Paul Moreton, Capital One’s senior director of smartphone applications and payments. “Every bank has customers using mobile payment apps like Starbucks and LevelUp … there’s a way to study those patterns and gather data and it won’t cost you a dime,” he said.
While many banks are “freaking out” about what their mobile payments strategy will be, banks still control “the pole position,” with consumers, said Chris Gardner, co-founder of Paydiant Inc., which supplies banks with white-label mobile wallets and payment platforms. “Customers trust their banks and will follow them, which means the mobile payments game is the banks’ to lose,” he said.