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Technology

Retailers Warned About Locking Out Alternative Payment Systems

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Retailers Warned About Locking Out Alternative Payment Systems

As the fallout from CVS Health Corp. and Rite Aid Corp’s decision to disable Apple Pay in their stores continues, retailers have been cautioned about the risk of losing customer loyalty if they lock out alternative payment systems.

That’s the opinion of mobile commerce firm GSMA, which believes that as customer demand for NFC-based systems like Apple Pay continues to grow, retailers are not going to be able to lock out all alternative systems, as they may risk losing customers' loyalty altogether.

"We are starting to see a shift against big monopolies, as regulators and governments push for healthy competition and customer choice,” said Claire Maslen, financial services relationship manager at GSMA.

Maslen added that this is especially evident when considering the big card schemes in Europe and the position to drive new models for interchange.

In terms of the retailers, GSMA believes that it makes sense to provide customers with the ability to browse, review products, take advantage of special offers, pay for what they want and buy everything from within the application, and this is something that Apple has supported with its in-app payment facility.

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However, integrating this functionality into existing retail systems is not easy and comes at a price for retailers.

GSMA added that technology providers, mobile carriers and service providers (in this case, CVS and Rite Aid) have to offer consumer choice.

According to GSMA, it’s not about the best, snazziest, most profitable solution for the company – it’s about ease of use for the consumer.

© 2014 European Supermarket Magazine

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