Why New Zealand's Banks, Telcos Built a Mobile Wallet 'Hub'
As a consortium of banks and mobile networks in New Zealand puts the finishing touches on the Semble mobile wallet system, the group chose a technology "hub" model to ensure that it can adapt to the fast-changing movements in the payments industry.
Semble is using technology from Gemalto to provide a single connection, or hub, to link transportation companies, payment providers, retailers, airlines and other service providers with mobile network operators and devices that use SIM cards, host card emulation (HCE), tokenization and other methods to manage user identity and execute mobile payments.
"We'll be able to evolve the technology as the market needs evolve," said Rob Ellis, CEO of Semble, which has been in pilot since late November with about 250 consumers and plans to launch early this year. "At the end of the day, the customer only cares about what technology works, and what value it has in their everyday lives."
Semble is a collaboration between Paymark, a company that processes the majority of electronic funds transfer transactions at the point of sale in New Zealand, and the country's largest banks: ANZ, ASB, BNZ and Westpac. The country's primary mobile network operators 2degrees, Spark and Vodafone are also part of the consortium. ASB and BNZ are Semble's initial issuers, and the company did not address the addition of other banks.
The hub aims to speed merchant onboarding for mobile payment systems by eliminating connection points and allowing more technology diversity, said Winston Yeo, vice president of product management and strategy for the Trusted Service Hub at Gemalto. In the past few weeks, Gemalto has also deployed the service, called Allynis Trusted Services Hub (TSH), to Valyou, a Norwegian mobile payment service owned by Telnor, DNB and Spar Bank 1.
The current version of the wallet is based on NFC, which typically requires access to a phone's secure element. But HCE, a technology introduced to Android phones in the mobile operating system's "KitKat" update, is growing in popularity because it allows contactless payments without such deep access to the handset's hardware.
"We'll be able to incorporate things like HCE and cloud-based elements as the consumer demand for this technology increases," Ellis said, adding Semble will also likely adopt QR codes for contactless payments.
Semble plans to add coupons, offers and other functions traditionally accessed by plastic cards such as transit access. "We want people leaving their wallets at home," Ellis said.
Semble estimates there are about 16,000 payment terminals in New Zealand that can accommodate NFC payments, an addressable market that is also attracting other wallet providers.
Westpac is developing its own mobile wallet, which relies on NFC stickers and HCE to broaden consumer adoption, and Ellis said he expects Apple and other players will soon enter the market. Westpac, which worked with Gemalto to develop the stickers, did not return a request for comment by deadline.