An NFC-based mobile wallet and the bold creation of Canada’s largest wireless carriers, suretap looked promising at first. But in the end, it couldn't keep up with juggernauts like Apple Pay, Android Pay and Samsung Pay.
At its inception, suretap had the built-in advantage of reaching more than 90% of prospective customers in a country with a strong contactless infrastructure and support from big retail partners like Tim Horton’s, McDonald's and Subway when it launched last year.
But suretap couldn't overcome its biggest limitation—it was accessible on Blackberry, Android and Microsoft handsets but not the iPhone. It also had only one major bank partner, CIBC, plus the banking arm of Rogers Communications, the mobile company that helped found it.
The mobile wallet plans to shut down for good on Aug. 26.
Suretap, which was supported by several of Canada’s major telcos including Bell Canada, Telus, Koodo and Virgin Mobile, attributed its shutdown to “ongoing changes in the market, and an increasing number of mobile payment and banking options.”
Experts say Apple Pay's debut in Canada this May spelled the demise for suretap; Apple allows only its own NFC wallet on iPhone handsets. And as of June 1, all Canadian banks support Apple Pay.
Additionally, not every Android or Blackberry handset has NFC capabilities in Canada, and the service only worked with certain payment cards, said Jacob Jegher, senior vice president, banking and head of strategy at Javelin Strategy & Research.
“The writing was on the wall for suretap as it struggled to overcome its own barriers to consumer adoption, and as more competitors’ mobile wallets came along,” Jegher said. “Mobile wallets have become a hyper-competitive space and if you’re unable to provide ubiquity and consumer choice, it’s a slippery slope for survival."
Other factors worked against suretap. On Android handsets, which support Host Card Emulation for contactless payments that bypass the device's secure element, suretap faced a flood of competition from the very banks it sought to partner with, said Zilvinas Bareisis, an analyst with Celent.
“Mobile network operators just never managed to present a compelling case for the card issuers to join the SIM-based secure element solutions, especially in light of the alternatives,” he said.
Suretap’s exit is yet another example of mobile network operators failing to succeed with their own mobile payment concepts, despite the control they can exert over their own technologies and audiences. A consortium of wireless companies in the U.K. tried and failed with Weve; in the U.S., AT&T, T-Mobile and Verizon also failed with Softcard, which they eventually sold to Google.
“The few mobile network operator-led wallets that are enjoying some success around the world tend to be based on a prepaid account and don’t rely on having to securely store bank-issued credentials on the secure element,” Bareisis said.
Suretap got its start when Rogers and other mobile operators in in 2012 formed a joint venture that eventually evolved to suretap when it rolled out in the fall of 2015, anchored by a prepaid MasterCard to enable payment at all retail locations. InComm provided suretap's platform and as recently as a year ago, the venture expected other large banks to come aboard.
Suretap's demise strengthens its competitors but does not open up any opportunities for newcomers, Jegher said.
“Now that the big third-party mobile wallets are in the market, it’s going to be hard for any startups to work around those. Now it’s a question of which options consumers adopt,” he said.