Alphabet Inc.’s Android Pay mobile wallet made some headlines recently with the company’s announcement that the app would be available to Masterpass and Visa Checkout users for online payments. But Google, the Alphabet unit that manages Android Pay, has quite a bit more planned for the 13-month-old service, and last week a top Google executive pulled back the curtain just slightly.
One technology Google is beginning to exploit allows users to transfer other credentials beyond payment cards as part of a single tap transaction. These could include rewards cards and ID cards, he said. This technology relies on Smart Tap, a system Google acquired last year when it bought intellectual property belonging to the defunct Softcard mobile-payments venture managed by leading telecom companies. Smart Tap is available now in all U.S. Walgreen's stores as well as at tens of thousands of Coke vending machines, according to Google.
Yet another Android Pay thrust to remove payments “friction” involves doing away with online checkout forms. “We’re working to eliminate checkout forms altogether,” Bhat told the audience. “We’re testing it out. This enables you to completely skip the form.” The technology relies on a standard developed by the World Wide Web Consortium, a standards body of which Google is a member. Google is the first company to exploit the technology, the conpany says.
Google has for some time allowed users of its Chrome browser to auto-fill checkout forms after making a purchase through Google, a move that has increased checkout conversion by 25%, Bhat said.
Android Pay, which competes with Apple Inc.’s Apple Pay and Samsung Electronics Co. Ltd.’s Samsung Pay among newer third-party wallets, as well as strong incumbents like PayPal Holding Inc.’s established product, has gained some ground lately with consumers, according to Bhat. Weekly contactless-payment volume on Android Pay, which refers to in-store transactions with the wallet, have “more than doubled” over the “past few quarters,” Bhat told the audience, without citing numbers.
“To grow, we need to get more banks on board, get into more markets, and get more ways to pay, like wearables,” he said, referring to contactless-payment capability integrated with articles of clothing and items like watches.
Results of a survey of 1,000 consumers released Monday by the American Bankers Association revealed 21% have used a mobile app to make a payment. Among these app-using consumers, Android Pay is the third most popular wallet, at 32% of users, behind Apple Pay (34%) and PayPal (65%).
But Android Pay and its rivals will soon have a new competitor on their home turf. Ant Financial Services Group announced at Money20/20 that its Alipay payments app, which is popular in China, is coming to the United States. “Today, we’re in discussions with many retailers for Alipay to be accepted online and offline,” Douglas Feagin, head of Alipay International, told the audience. Ant is working with terminal maker VeriFone Systems Inc. and processor First Data Corp. to establish its U.S. beachhead.