TMG card issuing clients prepare to implement Samsung Pay and Android Pay
DES MOINES, IA (September 14, 2015) — Following recent announcements from both Samsung and Google regarding the rollout of their digital payment solutions, financial institution clients of TMG (The Members Group) are preparing their strategies to make the solutions available to consumers.
In a recent exclusive client webinar, TMG’s digital and product teams asked nearly 75 attendees if they plan to implement each solution. For both Samsung Pay and Android Pay, 86 percent of respondents said they plan to make the solution available to their cardholders. When asked which of the two solutions they believed would be more attractive to their cardholders, 54 percent said Samsung Pay, and 40 percent said Android Pay.
“TMG’s market-leader positioning with Apple Pay enablement has paved a quick and easy path to digital wallet access for our clients,” said TMG CEO Shazia Manus. “Today, more than half of TMG’s financial institution clients are live or have a project underway with Apple Pay. Because Samsung and Google’s rollout plans appear to follow a path similar to that of Apple’s, TMG anticipates a comparable enrollment experience.”
This week, Google announced the official U.S. release of Android Pay, the digital wallet available on all NFC-enabled Android devices running KitKat 4.4+. Android Pay is now available to consumers through the largest U.S. issuers. Active credit and debit cards previously loaded into Google Wallet will also function inside Android Pay today.
Android Pay is similar to Apple Pay and Samsung Pay in that it relies on near-field communication (NFC) terminals for use in-store. Android Pay will also allow for in-app purchases and use of some merchant loyalty cards and special offers.
Manus points to TMG’s experience with Google, both directly and through API technology. The processor began working directly with Google in 2011 to ready its clients for enrollment in the Google mobile payments solutions. In 2014, TMG built the wearable payments app See2Pay for use with Google Glass. The processor has also developed simple, affordable processes that make it easy for financial institutions to allow their cardholders access to innovative payment solutions. In October 2014, Apple brought mobile payments to the mainstream with its introduction of Apple Pay. Before the end of 2014, TMG became the first CUSO to take a client live with Apple Pay.
“We had to build out tokenization solutions before we could take clients live with Apple Pay,” said TMG Director of Digital Payments Strategy Brian Day. “Because we have established simple steps for taking both credit and debit portfolios through the tokenization process, and the majority of our clients are already set up, we anticipate an even faster implementation process for Android Pay and Samsung Pay.”
As a strategic partner for its financial institution clients, TMG works to educate its clients on the various digital payment options available and provide expert guidance to help clients choose which solutions will be the best fit for their cardholders. “With many digital payment tools entering the space, it can be difficult to keep track of the various features,” said Day.
Although Samsung Pay comes with its own set of complexities, there is one distinct, stand-out feature: Samsung Pay will work almost everywhere credit and debit cards are accepted. That’s because in addition to NFC, Samsung Pay uses Magnetic Secure Transmission (MST), which mimics the technology used by credit and debit cards today. Thus, it’s expected to work at 90 percent of the country’s terminals.
It’s important to consider, however, Verizon Wireless is not currently supporting Samsung Pay. “With Verizon being one of the largest carriers in the U.S., that’s a big problem for Samsung,” said Day. “However, a lot of people anticipate a deal will be made between Samsung and Verizon.”
Another key consideration is Samsung devices are powered by an Android operating system. “Consumers with the latest Samsung smartphones may soon find competing payment solutions pre-loaded on their devices,” said Day. “Which solution Samsung device owners choose is likely to be influenced by both merchants and issuers.”
“The long-term impact of Apple, Google and others like Samsung remains to be seen; today, however, it’s clear they are generating a great deal of momentum around digital payments. As more consumers carry handsets with mobile payment options and more merchants begin to accept them, the closer we get to widespread adoption of a new way to pay,” said Day. “All indications are the payments industry is seeing the beginning of enduring disruption.”
”As our financial institution clients face the unknowns presented by exponential technology, rapid innovation and an unprecedented pace of change, they are not alone,” said Manus. “With TMG as a partner, credit union and community bank leaders can clearly see and navigate entirely new possibilities for the future.”
About TMG
TMG is dedicated to creating customized, technology-driven card processing and payment solutions for credit unions and community-based financial institutions across North America. Innovations in fraud management, loyalty programs, alternative payment systems and analytic reporting, and the competitive advantages they create, have helped TMG forge a new standard in offering cutting-edge credit, debit, ATM, prepaid card products and a P2P payment solution. For more information, visit www.tmg.global.
