In cash-heavy UAE, Mobeewave bets on near-field payments

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Mobeewave is rolling out its mobile point of sale technology in the United Arab Emirates, a country that still has very high cash usage despite government initiatives to encourage digital payments.

Estimates suggest that around 80 percent of retail spending in the UAE is cash-based, as local consumers see cash as a quicker and safer option than cards. The UAE Government and the Central Bank have initiatives underway to transform the country to a digital economy and migrate consumers to digital payments.

Montreal-based Mobeewave's partners are Middle East payments processor Network International, Mastercard and secure ID technology vendor IDEMIA. Network International will offer Mobeewave’s solution to merchant clients in the UAE in the first deployment of the Canadian firm’s technology in the Middle East and Africa region.

“Our deal with Network International is about encouraging local merchants to increasingly shift to contactless payment acceptance,” says Samuel Mulligan, Mobeewave’s communications manager. “Across the Middle East as well as in the UAE, contactless payments are getting a lot of traction.”

Emirates NBD bank owns a 51 percent stake in Network International, while the remaining 49 percent stake is held by investment firms Warburg Pincus and General Atlantic. Network International, which is the largest acquirer in the UAE, provides both card issuing and acquiring processing services in the Middle East.

Mobeewave’s software enables small and micromerchants to accept contactless card and mobile wallet payments using its mPOS app on their smartphone with no add-on hardware. The technology is offered on a white-labeled basis to merchants by their acquirers and mobile network operators.

There are limitations to using Mobeewave’s software. Because Apple doesn’t provide open access to the NFC hardware on its iPhones, Mobeewave works only on Android phones, although it accepts payments via Apple Pay. Also, it requires NFC-enabled higher-end smartphones that contain embedded secure elements, such as the Samsung Galaxy S7, S7 edge, S8, S8+ and Note8. The secure element is used to encrypt the customer’s payments information before this is transmitted to the acquirer, although none of the data is stored on the merchant’s smartphone.

Mobeewave does support Host Card Emulation mobile payments, which simulates a secured element and processes payments in the cloud. However, the firm doesn’t currently have any pilots of its platform being used with HCE.

“It’s possible to incorporate a PIN on Glass feature in the Mobeewave platform,” says Mulligan. “But, while the Mobeewave team has already done the necessary technical development, there’s currently no payment industry standard for software-based PIN on Glass. So Mobeewave is working closely with the standards bodies to ensure our platform will be in line with such standards as and when they are introduced.”

Mulligan says Mobeewave targets both mature contactless markets such as Canada and Australia and emerging markets for contactless payments. “We see our solution as being of benefit to small and microsized merchants who haven’t embraced traditional terminals,” he says.

Mobeewave’s platform can also be used by large merchants to offer payment-on-delivery options to their customers, or for line-busting in stores and at sporting, music and other events. In Fall 2017, Mobeewave launch a pilot of its technology with Mastercard, Elavon, the Polish acquirer Polski ePłatności (PeP) and merchants in Poland.

“We chose Poland, as it’s an emerging market in terms of transitioning from cash to contactless payments,” says Mulligan. “The Polish pilot has now gone live and has become a large-scale, nationwide project. PeP has dozens of merchants using our platform in Poland and its goal is to on-board around 500 small and microbusinesses.”

Mastercard sees Poland as a good test bed for new payments technologies, Mulligan says, as it has a large installed base of contactless cards and the Polish government has initiatives to encourage merchants to accept card payments.

According to the National Bank of Poland, in 2017 there were 29.4 million contactless payment cards issued and an installed base of 514,000 contactless terminals in the country. However, many small and micromerchants don't accept card payments.

Mobeewave works closely with Mastercard, which included it in the Mastercard Start Path fintech accelerator program last September. Start Path provides participants with access to Mastercard’s network of partners. “We also work with Visa, and earlier this year signed a global partnership deal with Samsung,” says Mulligan.

In Canada, Mobeewave has taken part in several pilots of its technology over the last few years, including a large hockey tournament in Toronto in 2015 where event staff used NFC-enabled smartphones running Mobeewave software to collect charitable donations from thousands of players.

Last December, Commonwealth Bank of Australia said it would deploy Mobeewave’s technology with its merchant clients during 2018.

Over the next few months, Mobeewave expects to announce deployments of its technology by a major Canadian bank and by an Asian mobile network operator.

“In the last six months, we’ve seen a big growth in contactless payments in Canada, with contactless cards being accepted everywhere,” Mulligan says.

The Asian telco will offer Mobeewave’s solution to its customers who are mobile self-employed traders or providing services such as tuition or gardening.

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Mobile point-of-sale Cash UAE