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The Mobile-Payment War Is On

Wall Street Journal columnist Charlie Wells included FitPay today in a story today about mobile payments:

Wall Street Journal, By Charlie Wells

Companies ranging from Apple to Uber gave consumers a taste of something new in 2014: What it feels like to make a purchase without a wad of cash or the swipe of a credit card.

The companies say their latest payment systems—which use new technology on mobile devices—benefit consumers by reducing “friction,” making it faster and easier for customers to pay for what they want with their smartphones…

 

…Some younger firms, meanwhile, have set out to explore uncharted payment territory. FitPay co-founder Michael Orlando says he was inspired to add the ability to pay to wearable fitness bands after a melted energy bar wrecked his wallet on a bike ride and he couldn’t buy a beer.

Some four months ago, Mr. Orlando began building a payment platform that will identify users by their electrocardiograph, the unique activity of their hearts. Stores will be able to sense when authenticated customers enter and want to make a purchase, communicating with FitPay to process the transaction. One report compared the service to something out of the sci-fi film “Minority Report.” Mr. Orlando says it will be available in April 2015.

Full article

 

PaymentsSource

FitPay Aims to Eliminate Effort from Wearable Payments

By Bailey Reutzel – Payments Source

 

FitPay Inc., a wearable technology provider, is betting that the only way to change consumer behavior is to eliminate consumer behavior.

Its software is designed to work through a payment-capable bracelet, but it doesn’t work like other bracelets and smartwatches that require users to hold a wrist up to a payment reader. FitPay’s approach is more like the system predicted in the science fiction film Minority Report, where customers are identified automatically as soon as they enter a store.

The bracelet authenticates users through electrocardiography (ECG) or the electrical activity of the heart and communicates with the merchant using Bluetooth Low Energy. FitPay will initially support Bioynm’s Nymi band, which is also being used by MasterCard and RBC.

Other prominent mobile payment providers, including Apple Pay, haven’t fundamentally changed the user experience even as they shift consumers away from cards, said Mike Orlando, co-founder and CEO of FitPay.

“The consumer is still interacting with the terminal and the phone and forcing the consumer to do something,” Orlando said. “The change that will create adoption is … an experience where it’s completely touchless.”

The bracelet communicates with Bluetooth beacons in each store. These beacons can determine when shoppers enter a store and when they approach the point of sale.

When it’s time to pay, the merchant rings up the items for the customer and FitPay pushes the transaction through. Consumers can see the total on the merchant terminal and they also receive a notification on their mobile device that they’ve paid.

While consumers don’t want to go through a bunch of steps to transact, FitPay’s system could make some nervous. If a merchant for instance accidentally rings up an item twice or rings up an item that the customer doesn’t want there isn’t a way to stop the transaction right at the point of sale. Instead disputes are dealt with on the back end by FitPay.

True to its name, FitPay is also focusing on the health and fitness data that can be gleaned from wearables. The company is building a rewards platform and sees a future where merchants and brands pay to access this data and push offers to consumers. For example, Jamba Juice might want to reward consumers with a free smoothie if they walk 10,000 steps a day, said Orlando.

FitPay charges the merchant a per-transaction fee, and the consumer-facing mobile app that ties into the wearable could be monetized in the future as well.

FitPay plans on launching its wearable sysytem in May 2015. The company is currently beta testing the product with several merchants and banks but wouldn’t disclose their names.

FitPay expects its merchant and banking partners to help promote and distribute its wristbands. The company also plans to tie into some of the open fitness platforms, such as MapMyFitness (owned by Under Armour) and MyFitnessPal.

Wearables are getting a significant amount of attention as the end of 2014 nears. PNC is readying its tech to deploy on wearables. PayPal is continuing its wearable wallet push by supporting the Pebble smartwatch.

Disney reports sharp adoption of its payment-capable MagicBands, which also work as hotel keys and theme park tickets. And the upcoming Apple Watch will support Apple Pay.

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No Wallet, No Phone, No Card Required – But Ya Gotta Have Heart

By D.J. Murphy, Editor-in-Chief, CardNotPresent.com

The emerging trend of fitness wearables, a passion for taking friction out of payment transactions and melted chocolate coalesced over the past year into a startup that hopes you never have to take a wallet—or a phone—out of your pocket to pay for things ever again.

FitPay, a California-based company, was conceived when CEO Michael Orlando, a payments veteran from CyberSource and authentication technology company Jumio, went on a bike ride. Orlando and a friend planned a long ride with a stop for refreshments, so he took along a pouch with his phone, a credit card and a chocolate energy bar. When the pair finished their ride on the hot California day, Orlando’s hopes for a cold beer were dashed when he opened the pouch and his energy bar had melted over his phone and the card, rendering both of them useless. More

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Money 20/20: Intelligence Beyond the Swipe

FitPay Founder and CEO Michael Orlando will speak on a panel at the Money 20/20 conference in Las Vegas, November 2-5, 2014. The panel, which takes place on November 3, will explore gaining consumer insights though integrated payment data.

Panel description:

“Merchants now have the opportunity to leverage integrated payments data to gain insights into consumer behavior, reduce risk of fraud and make more informed business decisions. This session will discuss how big data and shopping insights are enabling merchants to get a detailed understanding of inventory, optimize sales and provide a seamless shopping experience across all channels.”

Conference information can be found here.

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Fintech Startups Could Bolster Apple Pay Against Identity Theft

Here is an interesting post from from LetsTalkPayments.com about mobile payments and identity theft:

In the final pre-launch days, a possible issue with Apple Pay has come to light – does Apple or the card issuer know who is actually loading a credit card into Apple Passbook?  As Apple Pay and the myriad of payment alternatives become available to tens of millions of consumers, mobile payment providers and card issuers face a basic problem – is the person loading a credit card into a mobile wallet the account holder of that card? More

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Why the Mobile Payments Space is the Most Exciting Space in Tech Right Now

From The Washington Post:

Why the Mobile Payments Space is the Most Exciting Space in Tech Right Now

It seems as if every big player in the tech sector is developing a mobile payment solution. It’s not just Apple Pay, which was announced with much fanfare at the big Apple launch event in early September, and reportedly could go live as early as Oct. 20. There are now rumors that Facebook is working on mobile payments. Add to the mix PayPal, Square and Google and it’s clear that some of the smartest innovators in the tech world are on the cusp of breaking the mobile payments space wide open.  More…

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Reducing Friction Through Wearables

The Open Mobile Summit, which is takes place in San Francisco this November, has posted an interesting interview with Itai Vonshak of Pebble. Vonshak discusses the role of wearables as a new breed of consumer technology and the key to a seamless consumer experience.

The interview can and information about the Summit can be found here.

 

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Home Depot: 56M Cards Impacted, Malware Contained

Here’s a good summary by KrebsonSecurity of the data breach that Home Depot recently disclosed:

Home Depot said today that cyber criminals armed with custom-built malware stole an estimated 56 million debit and credit card numbers from its customers between April and September 2014. That disclosure officially makes the incident the largest retail card breach on record. More…