It doesn’t seem that long ago that paying for a holiday on a desktop computer was the peak of hi-tech cleverness. Then smartphones, Apple Pay and wearables came along, making all that came before it look positively antiquated.
In 2017, a Swedish railway company, SJ, went a sci-fi step further by offering passengers the chance to pay via a microchip... that was implanted in their hands. What’s interesting is that this suggestion came from the passengers themselves.
“The idea came as a request from some customers who already had microchip implants,” says Stephan Ray, Press Officer for SJ. “They were looking for new services for their implants and thought that train tickets would be exciting. The reaction has been overall very positive, especially in the tech industry where we find most of our microchipped customers. About 3,000 unique customers have used the microchip ticket and there are about 150 customers a month who use the service on a regular basis. We have about 130,000 customers a day, so it’s quite a small percentage.”
It’s perhaps not surprising that Sweden is trialling such technology, as it was reported earlier this year it was on course to become the world’s first completely cashless society.
SJ is still treating its project as a trial, and Ray acknowledges that it’s not quite as seamless as initially hoped. “A common challenge is the fact that the microchip implant is located very individually, which affects the reading process,” he adds.
Thomas Helldorf, Worldpay’s Vice-President of Vertical Growth, Travel and Airlines, Global Enterprise Ecommerce, sees a growing movement to develop biometrics in payments, but not necessarily microchips. “Would I get the chip implanted to potentially chop off milliseconds because I don’t have to take out my phone or use my finger? The adoption is probably not going to be massive,” he says. “But there’s a general willingness to use fingerprints to unlock phones, and that is only a very small step to authorise and enable payment.
“With any new payment that you offer as a travel company, the perceived increase in speed needs to justify the perceived pain you have to go through to register, to set yourself up or to link something with your banking details.”
There is a growing trust in mobile payments, according to a recent Visa survey
Among other areas, Worldpay is involved in the development of payment using virtual reality (VR) glasses. While VR glasses can virtually transport you to a destination, it’s another step to use them to pay for the whole experience. Using glasses for payment is more common in the gaming and gambling industries, but they’re slowly making inroads into travel.
“We have had one pilot with VR glasses where you can pay within that experience,” says Helldorff. “We’re currently developing another one where you can use voice to pay, because the last one you had to use a little device and virtually tap your PIN. But it was a little bit clunky.”
Growing trust in mobile
One issue that is helping the research and development of alternative payment methods (APMs) is the growing trust in mobile phone technology. Visa’s 2017 survey into mobile money reveals growing consumer confidence: in 2016, 65% of consumers were worried about security, and that dipped to 59% in 2017.
Mike Lemberger, Senior Vice-President of Product Solutions at Visa, says: “We are entering a new era of payments, one in which connected devices can facilitate secure commerce experiences – where mobile payments solutions like Apple Pay and Samsung Pay are just the beginning, and payments and commerce can be embedded in any connected device.
“More than three-quarters of Europeans use their mobile phones for banking, tracking their spending and making everyday payments such as paying bills or parking. As one would expect, millennials are leading the charge, with 92% of those surveyed expecting to be ‘mobile money’ users within three years, if they are not already.”
We are entering a new era of payments, one in which connected devices can facilitate secure commerce experiences
While contactless payment in public transport is spreading around the world’s cities, Visa has been working with startups including HopOn to use Bluetooth technology to make payment for travelling even easier. “Your phone is recognised the moment you get on a bus or train,” explains Lemberger. “The bus or train recognises where and when you ride – and for how far – and charges you accordingly.”
Worldpay’s Thomas Helldorff sees the travel provider becoming even more of a digital travel companion. “This is absolutely booming,” he says. “All providers try to extend the relationship they have with the customer. And the mobile will be the main communication channel.
“If you’re somewhere in a tourist destination and you have the choice between queuing up for theatre tickets or you get an offer on your mobile phone asking if you want to add that to your general shopping basket, using the payment method you’ve already set up, just by using a finger on your phone, and that ticket is yours, it’s a no-brainer.”
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Hero image: SJ AB
More than 75% of Europeans use their phones for banking, according to a Visa survey
92% of millennials surveyed said they expect to be “money mobile” users within three years
Research into payment via VR glasses is growing in the travel industry
Bluetooth is being used to calculate payment for journeys on public transport
About 3,000 monthly users have used the microchip form of payment on SJ railways in Sweden