Mobile wallet rivals compete for consumer attention, services

by Kristen Nicole

Square has been leading the charge in mobile payments, and that’s included a focus on the Android platform as well. This week Square rebranded its Card Case app to become Pay with Square, a consumer-centric app that acts as an account for managing purchases. The rebranded app has been simplified for end users, enabling them to pay for products at participating retailers, and competes directly with Google Wallet and future offerings from PayPal.

NFC in the infrastructure gets the ball rolling

It’s a holistic approach to target merchants and consumers around its Square service, which started out with a card reader app for accepting credit card payments on a mobile phone. As the mobile wallet trend becomes part of our mobile infrastructure, more consumer-centered tools will be necessary to connect all sides of this burgeoning industry. NFC technology has been an important segue in this transition, helping Google readily introduce its own supporting services simply by including NFC capabilities in its Android-powered devices.

In fact, global sales of NFC-equipped smartphones increased tenfold to 30 million units in 2011, according to a recent report from Berg Insight. The research firm estimates that by 2016 we’ll have over 700 million handsets that are NFC-ready, with 100 million expected to be sold this year alone. The boom is encouraging to mobile wallet providers like Square and Google Wallet, but to credit card companies and carriers as well. 2011 also signaled a turning point for vendors and carriers supporting NFC technology, and Google’s been adamant about partnering with as many banks, retailers, developers and carriers as possible.

Security can help win the customers

But the mobile wallet platform is also becoming a competitive industry, as Apple, AT&T, Verizon and T-Mobile all have their own services. That leaves Square and PayPal with a limited platform reach, relying heavily on consumer products and services to obtain end users and retain a significant slice of the mobile wallet pie. And while PayPal has a more established history around payment services, Square’s been speedy on releases that seem innovative in their haste. That leaves security as a growing issue around mobile payments, especially with products that are quickly rolled out to scale. The ease of use for mobile payments also poses a security risk, presenting an important challenge mobile wallet services will face if they hope to win with consumers.