I often catch myself dreaming that one day we will live in a world where everyone will be able to pull out their phone, wave it against a terminal, EFTPOS machine or even petrol pump without having to open any sort of app and be on their way. Coles today revealed it's experimenting with a 60-person trial of SIM-based loyalty and rewards payments which is on one hand excellent, but on the other, diabolically misguided.
Paying for stuff via your phone is slowly being relegated from the realm of vaguely possible future-tech to the land of dreams, candy hearts, unicorns and rainbows. Several institutions have had a red-hot go at getting payments working via phone, including the Commonwealth Bank which released cases for people's iPhones and an app which didn't really do anything for the good folk on Android.
According to The Australian Financial Review, Coles now wants to try its hand at it, giving 60(!!) people around the country fancy new SIM cards that -- with the assistance of an app -- will let them pay for stuff at the checkout with their phones, while automatically provisioning things like FlyBuys reward points at the same time. Woo.
For a mobile-based payments system to actually work, you'll need the support of Google as well as Android phone manufacturers that build NFC into their phones. You see, you can't make secure payments on your NFC-enabled Android smartphone right now because manufacturers won't hand over the keys to what's known as the secure element. That's the special sauce that safeguards your money when it's being transferred between your phone and a terminal. Without that, people like the Commonwealth Bank and Coles can't actually secure the money going from one place to the other, so there's no point embarking on native NFC trials for Android.
That's why CommBank release NFC-enabled cases for iPhones, and why Coles is using a SIM card as the secure element rather than that of a native NFC chip.
So who can save us from our band-aid-style mobile phone payment problem? Probably Google if we're all honest with ourselves.
Google Wallet has the support from major card providers as well as financial institutions -- something big banks in Australia haven't even been able to do --
The only problem with that -- and it's quite a big one -- is that Google Wallet will never come to Australia. Ever. If it does, I'll stand naked in Sydney's Pitt Street Mall draped in a Google sandwich board handing out flyers for Wallet. Get me Larry Page's hand to shake and it's a bet.
Back to Coles, however, which is just another half-baked trial being piloted by a big corporation as an attempt to be seen doing something about phone-based payments, rather than actually building something we can all use that works. If Coles really wanted to give you all phone-based payments, it wouldn't tell the mainstream media in a carefully prepared PR exercise that 60 people are trialling it around the nation. It would jealously guard that secret trial and work on it until it was perfect before blowing us all away with a new way to pay for things at the checkout.
The future for phone-based payments looks dark, indeed. [AFR]