Battle For Mobile Payments: Guide to Universal Cards

While the vast majority of consumers are still using plastic cards to make debit and credit card payments, a revolution is on the horizon. Digital alternatives will soon replace traditional POS payments. The end game will be making purchases using mobile devices and NFC. Until then, some believe all-in-one payment cards may lighten consumer wallets.
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The first part of this two-part series looked at the dynamic and ever changing mobile wallet landscape, examining the primary players in the mobile wallet space — Apple Pay, Android Pay/Google Wallet, Samsung Pay LoopPay, the MCX/CurrentC Paydiant Wallet, and PayPal Wallet.

In this article, we take a slight detour from mainstream payment technologies and visit some of the lesser known, but still exciting, offerings. Each of firms reviewed are startups that are betting on the fact that credit card as a form factor will be a hard habit for consumers abandon.

They all can be categorized as All-In-One or Universal Cards … allowing consumers to store more than one credit/debit/loyalty/ID card on a single piece of plastic and allowing switching between cards using electronics integrated on the card. Their message is, “Let us replace all of your current plastic with our single card.”

Their offerings are similar in many ways with slight differences from one to the other. While the offerings resemble a conventional credit card, they require a smartphone (primarily iOS or Android) as a supporting device to load different credit cards into the digital wallet. They use BLE to pair to the smartphone. Once the card is out of range from the phone, they enter into a lockdown mode that prevents the card from being used fraudulently.

We will analyze the following four offerings:

  1. Coin Card
  2. Plastc Card
  3. Swyp Card
  4. Stratos Card

Since the four products provide many similar features, most of their strengths, weaknesses, opportunities and threats are also similar.

Strengths:

  • Both Apple and Android users can use these cards as a unified mobile wallet/Universal card platform.
  • Works well in payment scenarios where the card has be to be handed to a merchant for a payment (like restaurants).
  • Works with most of the traditional magstripe card readers. Some of the offerings also promise future support for EMV and tokenization.

Weaknesses

  • Considered by many industry analysts as a stopgap technology. With the industry titans like Apple, Google, Samsung, PayPal and MCX throwing their weight behind a mobile-only solution, it is not clear what the appetite for these cards will be from the general public.
  • None of the four cards evaluated in this article have been shipped and are available for pre-order only. This leaves much to be desired when solutions like Apple Pay and Google Wallet are available today. The promised shipping time varies between the four players.

Opportunities:

  • It is all about execution. If these cards manage to ship on time and start gaining user loyalty with a robust offering, they may fill in a niche (Coin has already missed several deadlines).
  • Some of the cards (like Stratos) offer a membership-based model, which probably can be co-branded by financial institutions for their premier clientele.

Threats:

  • Again, It is all about execution. Some of these cards have had a rough time delivering on initial promises, leaving them with unsatisfied initial adopters who paid and are waiting for the product.
  • With the bigger players like Google and Apple throwing their weight on the ring, these players do not have too much wiggle room to make mistakes.

The table below provides a feature comparison of these four products:

Universal Card Payment Players

Features Coin Plastc Swyp Stratos
Card Enrollment External device reads magstripe and enrolls card. External device reads magstripe and enrolls card. External device reads magstripe and enrolls card. External device reads magstripe and enrolls card.
Price $117.50 (One time). Charged immediately during pre-order. $155.(One time) Charged immediately during pre-order. $99. (One time) Charged immediately during pre-order. $99 for one-year membership. $149 for 2-year membership. (A new card will be shipped every year). Membership begins on card activation.
Availability Pre-Order. No estimated date for shipping. Pre-Order. Estimated Shipping time during Summer 2015. Pre-Order.   Estimated Shipping during Fall 2015. Pre-Order. Estimated Shipping time is Summer 2015 (for orders placed now). Stratos provides approx. month when the card will ship.
Display Screen Yes. Displays card brand, last 4 digits and exp. date Yes. E-Ink touch screen. Displays all details including card number, brand, exp. date, card holder name, bar code, logo etc. Yes. 1×1 inch graphic displays name, account #, CVV, and expiry date. No. Uses tap and double tap mechanism to select cards from the app and accept suggestions using the smartphone.
Uses Any location with Magstripe reader. (POS, ATM, Gas Stations, Parking meters) Any location with Magstripe reader. (POS, ATM, Gas Stations, Parking meters) Any location with Magstripe reader. Any location with magstripe reader. (POS, ATM, Gas Stations, Parking meters)
International Acceptance Only Magstripe. Magstripe. Promise to support EMV Chip and Pin using a future OTA update. (NFC hardware present) Magstripe. Promise to support EMV Chip and Pin using a future OTA update. Only Magstripe. Promise to support EMV Chip and Pin/NFC contactless in future.
Battery – Chargeable? Non-replaceable. Require ordering a new card. Battery life is 2 years. Non-replaceable. Holds a 30-day charge. Non-replaceable. Rechargeable. Non-replaceable battery with 2 years average life. With new cards every year.
Number of cards Device can hold 8 cards. Accompanying mobile app can store unlimited cards. Device can hold 20 cards. Accompanying mobile app can store unlimited cards. Device can hold 25. Accompanying mobile app can store unlimited cards. Device can hold top 3 cards. Unlimited on the app.
Types of Cards Debit, Credit, Gift Cards, Loyalty and Membership cards with magnetic stripe. Store loyalty cards (even cards with only barcodes), store cards, gift cards, debit/credit cards and access cards. Support traditional magnetic strip cards, as well as Chip and PIN or contactless technology. Magnetic stripe based cards covering most credit, debit, loyalty, and gift cards. Magnetic stripe based cards covering most credit, debit, loyalty, and gift cards.
Mobile platforms iOS and Android. iOS and Android. iOS and Android. iOS and Android.
Pairing One device per Card. One device per Card. One device per card. One device per card.
Chip and Pin (EMV) support No. Yes. Plastc Card comes with a deactivated chip. An over-the-air firmware update in future will allow card to be used in all Chip and PIN (EMV) machines/devices. Swyp promises over-the-air firmware update in future will allow card to be used in all Chip and PIN (EMV) machines/devices. Promises a tokenized connected card platform that uses one time use stripe data (and contactless EMV/NFC) for secure payments in future.
EMV card enrollment Yes. Can only be used as Magstripe. (Depends on POS reader), Yes, with a special reader. Yes. No.
Security If card is lost, after three failed tap code attempts to unlock, coin card will erase all its contents. Card deactivates when out of range. Remote wipe if the card has been out of range for a specific duration of time. Card deactivates when out of range. Supports Remote Wipe. Card deactivates when out of range. Supports Remote wipe.
Card Locking Yes, can be enabled. With a 4 digit pin. Yes, 4-digit pin secure mode. Uses a Secure lockdown.
Can card be used standalone without a phone? Yes. Yes. However if remote wipe is enabled card will erase all entries after a timeout period. Yes. Yes.
Is Payment data stored on Cloud Servers? No. Card data is encrypted and only stored in Device. Card data is encrypted and stored in Device. No. Card Data is encrypted and stored on device. No. Card Data is encrypted and stored on device.
How to prevent fraudulent addition of cards? The Coin app requires that you take a picture of the front and back of the card, type in card details, and then swipe the card (using a reader provided) to ensure the card’s encoded magnetic stripe data matches the card details provided. An additional safeguard for payment cards, user must also confirm the amount of a temporary authorization by accessing online bank account and confirming a temporary transaction amount. In this way, Coin verifies that every card you add to the device is one that you have both physical and account access to. Uses 4-digit pin and Facial authentication when enrolling cards. Swyp companion app ensures name on the card matches the name of the person who the Swyp card is registered to. All members are ID verified and can only add their own cards into the Stratos App. This makes the platform insusceptible to card skimming. Stratos complies with federal KYC (Know Your Customer) standards.
Waterproof/Resistant? Water Resistant but not fully Waterproof. Waterproof. Unknown. Waterproof.
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Analysis

Coin CardCoin Card

Coin launched with much fanfare on the fall of 2013. The author was one of the early adopters who pre-ordered a Coin card. Coin was plagued with multiple production issues and the initial summer 2014 rollout for pre-orders did not ship. Instead, Coin offered an option to ship a free Beta card to initial backers. Author is still waiting for his Beta coin to be shipped, which should have been in November 2014 according Coin’s website status page. Coin says the Beta cards are being shipped based on early orders.

Plastc Card

PlastcPlastc Card has an e-ink touch display, which dynamically changes the card display information. The Magnetic Strip and NFC chip are disabled until the card is selected. Of the four cards evaluated here, Plastc card is the most expensive, probably due to the enhanced hardware.

The customer experience seems to be more intuitive, providing full card information on the display which end users may find convenient. The touch screen secure pin at the card level locks the card from unauthorized use if it gets lost. The wireless charging is a nice feature that extends the average life of how long the consumer may carry the card.

SwypSwyp Card

Swyp has an attractive all metal design with a small 1×1 built-in display. Swyp claims that this display is optimized to show the information needed by the user based on prediction algorithms.

Swyp app allows capturing receipts to track expenses. Swyp sold out the first batch of their beta cards and the website is accepting orders for their second batch.

Stratos Card

StratosStratos was company behind one of the first universal card ideas conceived. Stratos first generation card was called the Protean Echo, which was featured in TechCrunch around the Aug 2012 timeframe. However, Stratos was not happy with the customer experience of their first generation card, therefore, redesigned their product and rebranded the protean echo card as the Stratos Card.

The current product being offered for pre-order is the fourth generation according to Thiago Olson, the CEO of Stratos. Stratos took a different approach to the design, using the phone screen to provide relevant messages using tap and double tap actions. (The double tap action also uses a learning prediction algorithm to make recommendations based on location and history, getting smarter with more usage.)

Conclusion

The products presented here may be considered as a mobile payment bridge technology for consumers who are not willing to pay through phone for various reasons.

Consumers can be ambivalent in terms of their phone choices and these offerings provide a way to not lock them into a specific iOS or Android ecosystem. These cards promise to work with both these major operating systems. The only hurdle which may stunt the adoption for these cards is the initial purchase price – is the consumer willing to pay anywhere from $50 – $150 to thin their wallets and avoid the Costanza Wallet problem?

Unless these card providers manage to bundle their offerings with smart value propositions like reward offerings or co-branding with financial institutions/card issuers, they have a uphill climb in terms of mainstream adoption.

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