Mobile payment schemes and digital wallets have been a major topic of discussion in tech circles this year. In early December, Walmart became the first American retailer to announce its own mobile payment system that will be rolled out next year. According to Walmart executives, it will be compatible with both the Android and iOS platforms as well as major credit and debit card providers. This announcement bucks the trend of tech companies getting involved with digital wallets, including Apple, Google, and Samsung Electronics.
We’ve been profiling the growing mobile payment trend here on IPWatchdog this year and have noticed a growing amount of intellectual property being held by those companies in that field. This is interesting because software based payment systems, specifically for financial services, have been the target of much derision in recent months since the Supreme Court’s decision in Alice Corp. v. CLS Bank found a financial service implemented in software to be unpatentable. As our readers will see in more detail below, we noted an interesting increase in the amount of patent filing activity for mobile payment systems from each of the three largest banks as valued by assets. This is a peculiar about-face from a sector that, until tech companies started encroaching on financial services, had rallied against strong patent rights for software for quite some time.
With financial institutions embracing various forms of digital banking and payments, many — particularly larger FIs — are evaluating how much innovation should be driven internally, and how much through partnering. The latter route seems to make sense for make sense for many FIs, as it can offer a faster time to market and reduced development and QA costs. Still, some are evaluating whether certain key capabilities should be developed and managed in-house, and made the foundation for their proprietary offerings that may be part of a larger, white-labeled solution.
Overview by Ed O’Brien, Director, Banking Channel Advisory Service at Mercator Advisory Group
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