Coles, CommBank hoping payment smart tags will stick

CBA also announces updated app, NFC payments

Stickers for contactless payments got a major boost today as Coles and Commonwealth Bank separately announced small payment tags designed to attach to a user’s smartphone.

Coles announced a consumer trial of 5000 customers for a smart tag with MasterCard PayPass technology that sticks to any mobile phone and allows the user to make contactless payments at any retailer that accepts MasterCard. Users also earn Coles flybuys points when they use the tag to pay.

Separately, CommBank announced its own smart sticker called PayTag for Android and iPhones that allow customers with the bank’s app to make contactless payments of up to $100.

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Both tags will be able to be used in conjunction with apps. Coles plans to launch its app for Android and iPhone devices early next year. CommBank said it will soon update its existing banking app to support the contactless payments.

For those who don’t like the idea of attaching one or more stickers to their phone, CommBank said it will soon also support payments using near-field communications (NFC) chips that are included in many existing smartphones. However, CommBank said this will only be available on “certain smartphones.”

CommBank announced other updates to its app in addition to contactless payments. The new app will let customers check their balance without a PIN code, pay bills using QR codes and pay friends using a mobile number, email, Facebook contact or by bumping phones.

The app update, smart sticker and embedded NFC payment services “will roll out across the remainder of 2013 and into 2014,” CommBank said.

The CommBank app is available on iPhone, Android and Windows Phone. However, the bank did not say it would support contactless payments using the tag or NFC on Windows phones.

The news follows an announcement earlier this year by Coles that it was trialling contactless payments using Samsung Galaxy S3 smartphones.

In each of their announcements, officials for Coles and CommBank stressed the importance of modernising payments.

“We believe there is a significant opportunity for Coles to deliver Australian customers further innovation in financial services, as we continue to look for new ways to deliver better value every day,” said Coles finance director, Rob Scott.

CommBank CIO, Michael Harte, said the bank’s announcements today “deliver a whole new level of trust and convenience to the way consumers make mobile payments and manage their everyday mobile banking.”

“Trust is vital to deepen our customer relationship value in mobile banking. Our customers increasingly demand access to leading smartphone, tablet and PC technology. We continue to invest in rich content and the back-end technology that enables us to deliver real time value to our customers.”

CommBank has shown its innovative muscle with today’s announcements, according to IBRS analyst Guy Cranswick.

“It's not often that an Australian company tells the market what its roadmap is for so long with product enhancements and features,” he said. “These are qualitative enhancements and they do two things: for consumers, especially younger users it says this is going to get better, so come along and join.”

“Secondly, to the competition, it declares clearly that CBA is moving further ahead and the gap is growing as the NFC feature demonstrates.”

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