ANZ’s Card Replacement Program Could Spur M-Wallet Adoption
A new service launched to mitigate customers’ inconvenience if their payment cards are lost or stolen might lead to greater adoption of mobile wallets and be a model for other banks. ANZ, one of the largest banks in Australia, has introduced a service that automatically uploads replacement card details as virtual cards to customers’ m-wallets, while halting activity on the missing physical cards.
Cardholders are able to keep their existing PINs as long as the missing cards haven’t been compromised and the cards are replaced “instantly,” according to the bank.
ANZ customers report approximately 670,000 lost or stolen cards, annually, according to the company. “Now our customers can keep using their digital wallet, whether it’s Apple Pay or Android Pay, to make purchases while they wait for the new physical card to arrive in the mail,” said Katherine Bray, ANZ Australia products managing director. ANZ said customers completed approximately 8.3 million transactions last year using m-wallets.
Beyond providing convenience for ANZ customers, the service “jumpstarts mobile wallet adoption one lost card at a time” for those consumers who haven’t been using a m-wallet, according to Richard Crone, CEO of Crone Consulting LLC, an independent mobile payment consultancy. “You lost your card. You need access to payment credentials. You didn’t activate Apple Pay or Android Pay, so let’s activate it right now,” he says.
Crone tells Paybefore the service is the beginning of a shift from a dependence on physical cards to mobile wallets and, ultimately, that’s where financial institutions want their customers because it will set the stage for new revenue-generating services, such as linking an offer from a retailer or product brand that can be redeemed at the point of sale. Another possibility is cardless cash access. For example, a consumer goes to an ATM, presses a cash access button on his smartphone, scans a QR code and cash is dispensed. A plastic card is not exposed and nobody can look over your shoulder to steal your PIN. “What makes it all possible is the tokenization services for these account credentials,” Crone says. “It’s a cornerstone to mobile wallet adoption.”
ANZ says it’s the only major Australian bank to offer both Apple Pay and Android Pay, while its competitors, including Commonwealth Bank of Australia, National Australia Bank, Westpac, and Bendigo and Adelaide Bank, lobbied the country’s competition authority for collective bargaining rights with Apple. The banks wanted Apple to grant direct access to the NFC technology within the iPhone and allow them to charge consumers a fee for using Apple Pay. Apple countered in a filing with the Australian Competition and Consumer Commission (ACCC) that a decision to allow the banks to collectively bargain would “would harm consumers, lessen competition and reduce innovation in the banking sector.” Ultimately, Apple won out when the ACCC denied the banks’ request.