MCX CurrentC Paydiant Wallet

It is hard to analyze a mobile payments wallet, which only a few have used in Beta. MCX is the merchant conglomeration that is building their own mobile wallet to bypass the interchange fees paid by merchants to the payments network. MCX is basing its mobile wallet using Paydiant’s QR code / cloud wallet technology to their in store payments. The PayPal acquisition of Paydiant came as a surprise to many and saw the industry consolidating under a few well-funded players

Strengths:

• MCX is backed by a powerful conglomeration of merchants.
• Will provide coupons and offers through the wallet.
• Earning of  rewards from participating merchant rewards programs.
• Allows paying from bank accounts, gift cards and select merchant branded private label credit cards.
• Keeps customer transaction (SKU level) data internal to merchants.

Weaknesses:

• Uses QR-code technology, which doesn’t provide a fluid POS experience as Apple Pay and other mobile wallets.
• Does not accept major credit cards backed by payment networks like Visa/MasterCard/Amex/Discover (Future plans to support these are unclear)
• One of the primary funding sources is a customer’s bank checking account, which the customers may be unwilling to share due to security reasons.
• MCX CurrentC initiative was announced two years ago, but still hasn’t been rolled out to general public.
• MCX merchants with NFC terminal support who do not allow Apple Pay have received bad press with consumers.

Opportunities:

• MCX promises to pass along significant savings to customers by eliminating the swipe fees paid to card networks. As an example, MCX says customers may see savings in the order of 10 to 20 cents per gallon of gas by using CurrentC wallet in a gas station. This may be a powerful behavioral change, which customers may support in the long run when they see savings in action.
• Integration to loyalty/rewards programs offered by store an also be a reason for consumers to try out the CurrentC wallet.

Threats:

• A late launch into the market may see CurrentC face the same fate as Softcard, which never attained much traction irrespective of a huge marketing spend.
• Too many choices for mobile payments at the POS may confuse the customers who may chose to take the easy payment route. Instead of a ‘top of the wallet’ card problem, CurrentC may face a ‘most seamless way to pay’ challenge.

Analysis: The QR-code method of payments is still being successfully used in Starbucks for their mobile payments. From a consumer point of view, it remains to be seen if people will be motivated/willing to link their bank accounts to save interchange fees for a merchant in trade for nominal rewards/offers and coupons.