This article describing the Visa enabled BMW is just the tip of the Internet of Things iceberg. The payment enabling of everything should raise a wide range of interesting questions by issuers. Certainly Visa expects to see increased transactions as smart devices come online. But these smart devices may well end up being controlled by Apple and Google, since they intend to provide the world the OS that enables apps:
“Visa, the leading global payments technology company, unveiled connected car commerce at Mobile World Congress Shanghai 2015, a proof-of-concept solution to demonstrate mobile and online purchases on the go. The solution is being tested in Northern California, featuring Visa Checkout and other innovative mobile technologies to create in-car purchase experiences that are secure, convenient and easy. It can be applied to quick service restaurants, gasoline, transit and parking services.”
Apple and Google are working hard to make their respective operating systems the engines that will run the applications that execute across the Internet of Things, including smart cars. If successful, these companies will likely also control most internet enabled payment environments, including mobile wallets, mobile apps, mobile browsers, and even some eCommerce web sites. Consolidation of this scale should be a concern for issuers since those that consolidate can also negotiate.
Overview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group
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