25 Jun 2015

25 Jun 2015

Overview

By:

Problems of the Current Payment Solutions:

Issue
Technology Different standards, in particular in mobile payments, thwart the success of mobile based payment solutions. Companies in the market environment mainly try to introduce proprietary solutions which are not compatible with alternatives. At the moment, a mobile payment user is confused by the different standards and has to adapt to the infrastructure to use it instead of vice versa.
Some solutions have specific infrastructure requirements. Many financial technology companies offering new mobile based payment solutions do not have the connection to the traditional payment infrastructure. Therefore their solutions have new infrastructure requirements instead of using the existing payment infrastructure at the PoS.
Business Incomplete function sets. Banks already offer mobile applications to check your balance, transfer money between accounts, or locate the nearest bank branch (more than 5 million people used Mobile banking Smartphone Apps in 2012 in Germany). When it comes to making more complex banking transactions using Smartphones — from depositing Checks to transferring money to a friend’s account — many banks are not offering mobile technology as fast as their customers are ready to adopt it. This leads to the situation that the smartphone app is only used for specific payment use cases.
Bank-centric services instead of user-centric functionalities and payment models.Traditional Banks are interested only in providing solutions that are catered for the services they offer and support instead of solutions that are catered for the customer. This is true for the functionalities as well as for the payment models employed.
Social The new SEPA payment formats are a usability problem for the end customers. First, the SEPA Payment schemes are very complicated to understand (especially SEPA Direct debits) and need PC Support. Communicating, remembering and entering IBAN and BIC are much more complicated than the traditional account numbers. Business processes are not streamlined as adoption is ongoing (e.g. SEPA SDD B2B Mandate management)
Unbanked customers are not able to participate in the payments. However, according to reliable studies, around 58 million EU consumers over the age of 15 still do not have a payment account (cf. [1]). For customers it is often difficult to compare offers and prices for payment accounts from different payment service providers. The process for switching from their existing payment account to a different one is complex and unreliable. EU consumers are still unable to open a payment account in a Member State where they are not resident or if they do not have sufficient financial resources.
Payment and electronic banking is a very security sensitive topic. Many customers do not trust third party service providers or even their banks when it comes to non-traditional products.

VIMpay will be a European-wide, comprehensive solution that provides cashless payments based on SEPA Guidelines and standards, catering for all the user´s payment needs. Within this project petaFuel plans to implement and develop the VIMpay product to:

  • support consolidated access to multiple payment services, both mobile based SEPA cashless and card based payments (both contactless and contact based)
  • provide potentially every smartphone enabled EU citizen with this payment account functionality including unbanked EU customers
  • provide a safe, fast and easy-to-use  solution that lets the customer be in full control of the account and his or her payments
  • cater for further relevant payment needs of the customer by providing user-centric services that can be individualized.

When the project is completed, VIMpay will be established in the German region and be ready for market entry on a European scale starting with Austria (firsts tests within the project), Belgium, Netherlands, and Luxembourg (starting after the project).

  • Once the VIMpay App is installed on a smartphone the user has instant access to online card payments via a virtual Prepaid MasterCard and to cashless SEPA payments. The user can also order an actual plastic prepaid MasterCard, usable offline in stores anywhere MasterCard is accepted. All transactions made with the plastic prepaid MasterCard will be displayed on the user’s device in real-time. A MasterCard PayPass™ functionality will be integrated into the plastic prepaid MasterCard for contactless purchases.
  • petaFuel already has a successful mobile banking app called 123Banking in the market. Users of that app will be converted to active VIMpay users at the beginning of the project to ensure a strong user base for testing of the product from the beginning. Using the existing customer reach petaFuel projects an initial base of 220,000 active VIMpay users in the first year.
  • VIMpay delivers on a Simple Registration, Simple Authentication, and Simple User Journey. Additionally, with seamless interoperability between banking and payment, VIMpay has no limits on where, when, who or how.
  • With user concerns centred on Security, VIMpay delivers 100% Secure Authentication leading to Secure Transactions and guaranteed deliverables.