If banks and retailers want a piece of the mobile wallet pie that Apple Pay is steadily gobbling up, Nacha says it has a formula to achieve that.
Nacha, the electronic transactions organization that sets the rules for the automated clearinghouse network, will officially introduce its Mobile Wallet Team initiative in the coming weeks. Nacha shared some details with PaymentsSource this week.
In establishing the wallet research team, a new project for Nacha's Payments Innovation Alliance, the organization hopes to bring bankers, merchants and payments providers together to establish guidelines and best practices for an open common acceptance platform, said Samantha Carrier, senior director of advanced payment solutions at Nacha. Banks and retailers would be able to apply their own brands to the end product.
Such a foundation could pave the way for more ACH-driven wallets, a concept that the retailer-driven Merchant Customer Exchange aimed for with its CurrentC mobile wallet project. CurrentC was also devised as an open platform for merchants to apply their own branding to, but the future of the product is uncertain given this week's news that MCX CEO Dekkers Davidson has left the group and Best Buy, one of MCX's major supporters, has committed to accept Apple Pay in its stores.
But Apple Pay, even with its high level of buzz and influence, has still left "confusion, uncertainty and inconsistency" in the marketplace, Carrier said. As such, Nacha sees "tremendous opportunity" in what a collaborative mobile wallet team could bring to the table, she added.
Nacha revealed its intention to establish mobile wallet guidelines during its recent conference in New Orleans, and it was significant in that representatives from banks, credit unions, payment technology companies and retailers all spoke optimistically about working together, said Richard Crone, chief executive of San Carlos, Calif.-based payments consulting firm Crone Consulting LLC.
"This was the first time I can remember all of these people having this type of collaborative dialogue," Crone said.
Banks and credit unions are increasingly hooking their wagons to Apple Pay, but Apple can only take them so far. Each card issuer must still create its own branded wallet app to provide features such as account management and alerts.
"Even though it is hard, financial institutions should still be looking at how to build out their own infrastructure," Crone added. "And that's what we heard these players saying they are willing to do to help create whole new ways of accessing accounts."
Nacha's mobile wallet team would concentrate on developing a consistent user interface and addressing other challenges issuers face as they delve into mobile payments.
Stakeholders have identified a need to bring together the "full ecosystem of mobile wallet players for industry dialogue, knowledge exchange, and collaboration in an effort to address key topics and concerns," Carrier said.
Other organizations are also developing collaborative mobile wallet models.
On a smaller scale, Fresno, Calif.-based MShift Inc. is delivering AnyWhereMobile technology that could serve as an example of what a Nacha mobile wallet team may focus on. MShift helps financial institutions establish branded mobile wallets that operate through ACH, rather than payment card networks.
The company, originally a vendor in the mobile banking arena, offers technology that addresses mobile, online and person-to-person payments. MShift is operating a pilot mobile wallet with Team One Credit Union in Saginaw, Mich.
American Express' new Plenti loyalty program has a strategy that somewhat resembles the MCX approach to payments. Plenti is a common platform that gives consumers a loyalty card that works at multiple retailers' stores.