Analysis

Flik, Bump, Wave. The Future of Financial Transactions.

NAB Flik Screenshot

NAB’s new peer-to-peer payment app called Flik

National Australia Bank have joined competitors CommBank, and ANZ , finally launching their own peer to peer payments service. The mobile app is called Flik and allows customers to transfer money to friends and family without using a BSB and account number.  With NAB now seeing more traffic through their mobile site than through internet banking, investment in smartphone and tablet based financial services is imperative.

Like Commbank’s Kaching and ANZ’s goMoney, Flik customers can transfer funds using an email address, SMS message, or via Facebook.  Flik also introduces the ‘bump’ to customers with Android devices, whereby they can bump their phones together to transfer funds using NFC.  iPhone customers have to create  a custom QR codes which can then be scanned to accept a payment.

The iPhone transfer solution is not quite as cool as the bump, but iPhones do not support NFC technology.  In fact it now seems certain iPhones will never incorporate NFC.  NAB intend to integrate Bluetooth capability in future versions of the Flik app, given this is the direction Apple are now going instead of NFC.

We are set to see some big changes in the way payments are transacted in Australia in the next 12 – 18 months.  Apple’s latest operating system update included support for iBeacons – a wireless technology based on a low energy form of Bluetooth called Bluetooth Low Energy (BLE).  This new technology effectively puts the nail in the coffin for NFC. iBeacon support is actually a software rather than hardware change, so the capability is available as soon as iPhone users upgrade to iOS7.

Some estimates suggest that as many as 60% of iPhone owners have already upgraded their software to iOS7, which means their phones now support iBeacon.  This means any hardware developed for iBeacon can now ‘talk’ to these smartphones. An example of hardware would be anything you could imagine a smartphone could control.  A component inside a stereo that lets you turn the volume down with your smartphone, an automatic door that only opens for certain smartphones or a beacon that detects smartphones in the vicinity and delivers a message.See our recent article on iBeacons for more information.

Paypal_Beacon

Paypal Beacon. Just plug it into a powerpoint to enable wireless transactions.

Paypal has been quick to support the technology, announcing their new hands free payment device called PayPal Beacon.  A PayPal Beacon is a little device that retailers can plug into any power point in store.  The device uses Bluetooth to wirelessly communicate with smartphones that have downloaded the PayPal app.  All a customer has to do is walk into (or past) the store and they will receive alerts, offers or messages generated by the retailer.

Sounds like the ‘location based offers’ story we’ve been hearing about for years.  But the offer is only half of this story.  With PayPal Beacon, once a customer accepts the prompt, their image appears in the retailer’s Point of Sale system, ready to complete a PayPal transaction if the customer authorises it.  Verbal authorisation is all that’s needed. No cards, no cash, no swiping, scanning, bumps or waving a smartphone anywhere.  The technology is not limited to iPhones either.  Although Google has always been a strong supporter of NFC, the latest version of their Android operating system now supports Bluetooth BLE as well, which means PayPal beacon, and other similar services will work on any Android device with the latest software.   Google also recently waived the requirement for Google Wallet to only run on NFC enabled devices, opening the way for services like PayPal to join the party.

With a bet each way, you’d think Google would be pretty safe to support whichever of NFC and BLE comes out on top.  But not content to leave things to chance, Google recently invested in Bump.  For a cool $30 million they now own Bump’s proprietary technology that enables the exchange of content between devices by bumping them.  The tricky thing about Bump’s technology is that it’s not powered by NFC, Bluetooth or any other familiar wireless technology.  Instead, the app senses the bump, does some clever algorithmic matching in the cloud to detect other devices who also felt the bump and makes the connection that way.

Whichever technology comes out on top, one thing is for certain.  The way we transfer funds, perform transactions and share information between people and businesses is set to change forever.

 

Want to know more about iBeacon?

iBeacon is a feature of iOS7 that provides support for tiny, low cost transmitters (called iBeacons) to communicate with an iPhone via Bluetooth.  So developers could build iBeacons into doors, lights, whitegoods, stereos, TVs or anything else that can be controlled or activated.  By communicating with the iBeacon, an iPhone can then control the device.  See our recent article about iBeacon to find out more. 

 

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