Seven years ago, the armored truck company Brink's began adding payments features to its product list. It's one of the many unlikely candidates making a name for itself in the payments world.
Other aggressive newcomers include Starbucks the massive coffee chain that recently shuffled its executive lineup to prioritize mobile payments; Amazon.com, the e-commerce giant with its own digital currency and ambitions for P2P payments and T-Mobile USA, the cell phone carrier with its own prepaid card.
"One thing attracting so many new companies into the payment space is the growing awareness that a transaction is only one point in a cycle between merchants and consumers; it's what connects the offline with the online as well," says James Wester, research director for global payments at IDC Financial Insights.
"All the effort merchants have put in to attracting a customer culminates in that purchase and merchants can then take the purchase datawhat a customer bought, how much, how often, etc.and refine the interaction for the next cycle," Wester says.
Brink's began small, providing walk-in bill payments in 2006. The company then added mobile top-ups for underbanked customers as it started moving into countries like in Brazil, Colombia, Mexico and Panama, says Nasser Chanda, president of Brink's Global Payments.
"We were looking at adjacent industries [to move] our tremendous brand of trust and security," says Chanda. "We have an enduring and trusted brand with over 150 years of heritage and trust that customers are looking for when they seek payment solutions."
In the second quarter of 2013, Brink's launched its prepaid payroll card.
This month, Brink's began a partnership with 2Checkout, an online payments provider, to bring payment processing services to Brink's online merchant clients around the world.
"First, we operate in 100 countries, so we are truly international and can leverage products/technologies to multiple countries," says Chanda. "Second, we serve banks and retailers, so we can bring value-added partnerships to create products. Retailers that use our secure logistics services for their cash deposits can also act as agents for our bill payment and mobile top-up services, and can be customers for our payroll card or online checkout."
Each month, Brink's serves approximately five million customers. This level of contact provides it with a good foundation for a payments business, Wester says.
"Companies who already provide those customers' touch points are looking to add payments on to their services," he says.
Other non-payments companies aiming to disrupt the payments industry include Google and Groupon. Google launched Google Wallet in September 2011 as a mobile followup to its Google Checkout online payment product. Merchants and advertisers could easily use Google's wealth of data about online search behavior to target consumers for offline purchases, says Wester.
Groupon made its debut in payments with a mobile card reader that attaches to smartphones. Groupon acquired Breadcrumb, a tablet point of sale provider, in 2012 and has steadily updated its Breadcrumb POS product. In the latest version, Breadcrumb POS 1.3, the app lets merchants analyze customer behavior and record notes on individual preferences.
"For the first time ever, the payments space is being seen as sexy," says Jordan McKee, an analyst at the Yankee Group. "Much of this is owed to mobile's increasing influence on the industry. Mobile has created new opportunities and continues to be a primary driver of innovation."
Social media companies such as Facebook and Twitter have dipped their toes in the fast-moving payments water, and could stand to be leaders by linking transactions with rich customer profiles, says McKee.
Facebook's role in payments is steadily increasing, with the launch of its mobile checkout to improve user experience and the roll out of its "Autofill with Facebook" function with PayPal and Stripe, eliminating the need for consumers to type their billing information on smartphone screens. And the social network's new donation feature allows users to give to nonprofits directly through the organization's Facebook page.
Twitter, on the other hand, became a platform for other companies to experiment with payments. Dwolla, American Express Co. and Chirpify have all deployed Twitter-based payment products. And this past August, Twitter hired Nathan Hubbard as its first head of commerce, a move that may fast-track Twitter's transformation into a platform for payments.
T-Mobile's new prepaid card is the latest of many financial services offerings to come from carriers across the globe. Other prominent examples include M-Pesa from Safaricom and the Isis mobile wallet venture from AT&T, Verizon Wireless and T-Mobile.
"Given [mobile network operators'] existing customer base, trusted billing relationship and ability to authenticate users, they have an opportunity to succeed," McKee says.
Many retailers, also capitalizing on their loyal customer bases, are also getting into payments. Walmart, Target and many other nationwide brands participate in the Merchant Customer Exchange mobile payment initiative. And Walgreens has released a combined loyalty and prepaid card, Balance Financial, which it plans to expand with additional payment features this year.