Recently it was announced that when Apple Pay is launched in the UK in July, there will be low GBP limits to transactions set by many financial institutions, perhaps as low as 20 GBP, similar to those of other contactless payments. I think this is a step backwards, and certainly not a healthy position to take when it comes to driving consumer adoption in a mobile world.
I really don’t see how this sort of policy could be taken seriously – it sends a wrong message to consumers. In fact, as a consumer my first reaction would be not to use this product. With the limits set so low, the message is “this is not safe to use”.
A large effort has been made by the industry to embed tokenization into the payment process for mobile wallets, and there are any number of fraud and risk technologies that can protect the provision of the card to the wallet and point of sale transactions. There are many banks that have had successful mobile wallet launches, with much higher limits. Clearly, they’ve seen that complementing payments innovation with fraud risk innovation is the key.
Driving adoption is all about establishing habits. If a financial institution makes the customer think multiple times about whether each transaction would be allowed or not, they’re setting themselves up for failure. They are not creating an atmosphere that contributes to creating habits and encourages their consumers to use the new technology wherever available.
In my opinion, this scenario is an example of how a product launch can fail without the right kind of fraud and risk innovation and transformation, and possibly some of the bank product owners and executives may have to learn this the hard way. Either way, the levels will certainly have to increase very quickly – I just don’t see them existing at these levels for very long. Apple Pay users and Apple Fans in general will make their opinions known fairly quickly I suspect. Fortunately, we already are seeing retailers push back and offer their own higher limits – makes you kind of wonder the point of the whole announcement to begin with! Is this what innovation looks like? Not hardly!