The battle for the digital wallet is intensifying in Canada with the launch of a mobile payments app backed by Canada’s major wireless carriers and promises to include the big banks. Rogers has announced the expansion of its mobile wallet client, the suretap wallet, to Bell and Telus devices, including those on Virgin Mobile and Koodo. In fact, CIBC bank has signed up immediately after the announcement and will allow its customers to store any CIBC Visa or MasterCard credit card on the suretap app so they can pay using their smartphone.
Co-owned by Rogers Communications, BCE, and Telus, the launch of the the suretap wallet has been pushed back at least twice in the past. The launch on Tuesday means it will now be accepted on more cell phones, on more credit cards and at more merchants (more than 30% merchants in Canada have the terminals to accept such payments). But there are plenty of naysayers. The launch is timely as it has been done before the launch of Apple Pay in Canada, but there are few things that experts are skeptical about:
1. suretap has been pushed back at least twice in the past. It has been marred by issues. The reason for this might be that the Canadian telcos themselves are not fully sure of the wallet’s success.
2. A classic example why joint ventures (in general), especially between telcos, is not a good option for mobile wallets is the Isis mobile wallet (now known as Softcard). The US mobile wallet platform, backed by AT&T, T-Mobile and Verizon, had spent millions of dollars but did not witness large transaction volumes.
3. Apple Pay is expected to launch in Canada by this fall. Though more than 35% users in Canada are iOS users, suretap is not addressing these users. Moreover, a large number of Android phones in Canada still do not support NFC whereas suretap leverages near field communication (NFC) technology for making contactless payments.
suretap which was started by Rogers Communications was spun off into a separate entity called suretap wallet LP late last year. suretap initially was a closed wallet. It could only be used to pay for everyday purchases where contactless payments were accepted on select devices connected to the wireless network of Rogers Communications. The access was restricted to a handful of retailers and therefore transaction volumes were low.
The new open suretap wallet supports 38 credit cards and 30 gift cards in partnership with Canadian Imperial Bank of Commerce and Rogers Bank. The digital wallet company plans to increase the compatibility with other banks by fall. With the new suretap wallet, users can now make payments by a single tap at any contactless POS terminal. They can even keep a track of their transactions, spending and redeem gift cards at the point-of-sale via QR codes.
Brick-and-mortar retailers and online retailers such as SIR Corp, Cara Operations, Indigo, Cineplex, Forever 21 and Groupon have shown their interest to participate in the multi-partner program.
When asked about the move at a press release, the company said that the move is meant to enhance the position of suretap as a platform (and mobile payments in general) throughout the Canadian market.
It’s unclear whether Rogers reached a preload agreement on Bell and Telus devices, but the suretap wallet continues to be preinstalled on all Rogers Android and BlackBerry devices. The company plans to introduce the service to Windows Phone devices in the near future.
“It made sense to let’s say make sure there’s an application that’s good for the consumer, that the consumer can access irrespective of what carrier they’re on, or what bank they’re with, or what retailer they want to engage with. It avoids confusion and drives adoption,” said Jeppe Dorff, President of suretap.
When Jeppe Dorff was asked about Apple Pay by Bloomberg, he said, “I don’t think that this is a matter of them versus us. There is, give or take, 70% of the population that is non-Apple and those consumers need a ubiquitous experience as well.” Although Jeppe might be optimistic about the success of suretap, the probability of getting it right is low.