“It’s all over bar the shouting” as my mother used to say. And here it is – the final score and round-up from the Sitges trial for mobile contactless shopping. “la Caixa”, Telefónica and Visa Europe have completed their mobile payment experience in the Barcelona town of Sitges. The initiative, which lasted six months and in which the Sitges Town Council, Samsung and Ingenico were also involved, entailed shopping via a mobile phone equipped with NFC (Near Field Communication) technology. Some 1,500 individuals and 500 merchant customers of “la Caixa” and Telefónica participated. The “Mobile Shopping Sitges 2010” project was the first of its kind to be carried out in a real scenario in Europe with such a large number of participants.
The results indicate that the mobile shopping project was highly successful among all the participants, prompting the project promoters to leave the phones and payment terminals with their customers and merchants in Sitges indefinitely. Of customers participating, 90% used their phones to make payments, while 80% of merchants in the project carried out transactions using this system. The conclusions bear out the huge potential of mobile payments: customers carried out 30% more e-transactions, with a 23% increase in average purchase per user with their card.Users mostly made micro-payments with their phones: 60% of the purchases were for amounts equal to or less than €20, although there were also many for large amounts, and 75% were made during working days. Mobile shoppers made the largest number of purchases at supermarkets (57%) and restaurants (14%).
Also noteworthy was the acceptance of the technology by all groups of people; the average age of customers using their mobile phones to pay for their purchases was 46.
User opinion data were also highly satisfactory: the majority of customers considered the system to be quick and easy, giving a score for mobile payment of over 8 points. In addition, 85% of users said they considered the protocols for operating with the NFC system to be sufficiently secure.
Merchants participating in the project also considered it to be flexible and fast.
The intention to use the system in future was also high: 90% of users said they would continue to use their mobile phone for normal payment. The results obtained in Sitges reinforce the assumptions of the companies behind the project that mobile payment could be rolled out massively in Spain over the mid term.
It could be argued that it was the commitment of “la Caixa”, Telefónica and Visa Europe that ensured the success of the project, the largest carried out to date in a real scenario in Europe using NFC technology. The system enables users to make purchases by simply taking the mobile phone to a payment terminal.
With this project, “la Caixa”, the global mobility services leader headed by Isidro Fainé and run by Juan María Nin, aimed to enhance the service it provides to customer, to make further progress in innovation and to become a benchmark for other entities in new projects carried out. In the pilot project, “la Caixa” issued a VISA card, that was placed on the SIM cards of users’ mobile phones, making the same banking service available as if the customer used a bank card. It also equipped participating merchants with payment terminals.
According to data from Nielson, 50% of people in Spain that do banking with their mobile phones do so with “la Caixa”, the highest market share of any financial institution in the world. “la Caixa” currently has over 600,000 customers carrying out financial transactions with their mobile phones. It also heads the international working group on NFC payments created by Mobey Forum, which brings together operators, financial institutions and mobile phone makers.
Telefónica is playing an active role in the payment methods revolution through its IT and innovative solutions to help financial institutions with their market differentiation strategies and their adaptation to the new paradigm, driven among other things by the Single Euro Payments Area (SEPA). The operator has also set up a Financial Services unit expressly to drive the growth of new services in all countries where it operates.
As the leading mobile communications operator, Telefónica provides NFC (contactless technology) mobile service through an integrated platform and the network infrastructure that allows for remote management of contactless bank cards placed in mobile SIM cards. It provides customers with SIM NFC cards as a secure means of carrying their cards and to facilitate the application of the “virtual wallet”, enabling users to choose and manage their cards in an easy and user-friendly way. This technology has been developed for uniform deployment in all Telefonica’s markets. Telefónica is also a member of the GSMA (GSM Association), which promotes and facilitates cooperation in the mobile industry in the areas of standards and best practices for the future.
Visa Europe participated in the project by providing its universally accepted mobile payment application, another example of it is leadership in payment method innovation. “Visa Europe is committed to creating new added value products and services, that are more efficient and securer than cash, for the benefit of consumers, merchants and financial institutions” noted José Carbajosa, Visa Europe Country Manager for Spain.
The Sitges Town Council made the facilities required by Telefónica and “la Caixa” available, without which the pilot test could not have been successful. Sitges, it appeared, was the ideal venue for the experience, with a population of nearly 30,000, lots of shops and activity, and is poised to become a pioneering, innovative and a top resort city among Spanish and foreign tourists alike.