Merging Mobile Payments with Loyalty: Payments Source Interview

 

Clearbridge CEO Deepak Chopra and CTO Sanjay Malhotra talk Mobile Payments and Customer Loyalty with Payments Source’s David Heun.

 

David Heun’s recent article, “A Technology Shift Could Merge Mobile Payments with Loyalty,” addresses a salient topic that has been on the mind of tech companies, retailers, QSRs, and others trying to find the best mobile payments solution for their organizations: the current divide between mobile payments and customer loyalty programs.

 

As it stands, mobile wallets exhibit a significant lack of built-in loyalty programs, and as Heun points out, those that have tried to include one have struggled to make such a model work. This issue has significantly slowed merchant adoption of such payment systems, as a very important facet or the transactional environment – customer loyalty programs – is effectively absent from the system.

 

Clearbridge CEO Deepak Chopra and CTO Sanjay Malhotra spoke to Heun about ways of overcoming this divide by transforming NFC-based mobile payments processes from a one-way to a two-way interaction. This will enable loyalty to be built into such transactions, allowing customers to redeem loyalty points – a feature that isn’t available today.

 

Here’s what they had to say:

 

Sanjay Malhotra: The evolution of HCE (Host card emulation) will result in a better interaction between the merchant and the customer by enabling the redemption of loyalty points. If I am a regular at Tim Hortons and there is a loyalty program option there, having that type of payment solution gives me a better experience in the store.

 

Deepak Chopra: Advancements in HCE will help merchants understand what the technology can provide. In the U.S. marketplace, there is still an education process regarding HCE. THe credit card infrastructure is older, and the chip-and-PIN and NFC tap-and-pay are just now coming onto the scene. Merchants in Canada have been accepting NFC payments for more than five years, so the country’s wallet providers and merchants understand the benefits HCE.

 

While HCE may provide a way for merchants to integrate mobile payments systems without having to barter with carriers, it is not a replacement for EMV-chip cards, which are still being implemented for many point-of-sale transactions. While merchants can theoretically bypass EMV, accepting only mobile payments – as opposed to EMV and mobile payments – would present barriers to customers.

 

To read Heun’s full article, please visit Payments Source (paywall).