We have already talked about Samsung Pay as a new mobile payment solution for Android devices and now we take a closer look into Android Pay.
Android Pay is Googles latest solution and it is indeed not a direct competitor to Samsung Pay and Apple Pay, as it is an Application Programming Interface (API) which allows android app developers to create a payment platform for their own apps. Android Pay will allow contactless transactions at the POS by using Host Card Emulation (HCE). Additionally Android Pay is also supporting In-App payment with Google Checkout. This basically means that companies who run an Android Application and are interested in supporting mobile payments can simply add an Android Pay API layer to integrate In-App or In-Store contactless payments. Sundar Pichai, one of Google´s top executives also mentioned that Android Pay might accommodate support for biometrics as well.
But mentioning Google we also have to talk about the Google Wallet. Google Wallet was the first mobile payment approach of Google launched in 2011. It already used NFC as transmission standard but due to low acceptance rates, a small partner network, and the missing contactless infrastructure Google Wallet was not able to achieve main stream adoption.
Four years later, the market seems to be ready for mobile payments and also Google has improved their wallet over the years. Additionally the acquisition of Softcard former ISIS, which is a consortium of the biggest mobile network operators in the United States consisting of AT&T, Verizon, and T-Mobile, gives Google the opportunity to integrate the Softcard solution in their existing portfolio. Additionally the deal can be a strategic move to compete against Samsung Pay as these mentioned mobile network operators could possibly pre-install the Google Wallet on each individual NFC enabled handset (https://support.google.com/wallet/answer/1347934?hl=en). With Google Wallet you also have the ability to pay your friends via your Google Mail account or even split amounts and pay them to friends.
If we look at the user experience we can see slightly differences between Google Wallet, Apple Pay, and Samsung Pay. Like Samsung Pay you also have to wake up your Android device to make a contactless transaction at the POS, with Apple Pay in contrast you don´t have to unlock your smartphone. You can also simple add a Debit/Credit Card of participating banks or a Google prepaid card in your Google web account. Google Wallet is also available for iOS users, but we can see one huge restriction; Compared to the Android version you are not able to make contactless payment at the POS.
Google´s benefit
Due to the huge data pool of Google, they are able to track your behavior and send specific offers and offer loyalty programs related to your needs. But if you as a consumer feel uncomfortable with this feature you are also able to simply disable the service.
So how does Android Pay differ from Apple Pay and Samsung Pay?
Apple Pay and Samsung Pay seem similar in nature. But the API layer, which is more like a platform and not a product like the other two, allows Google to integrate their solution in third party apps. Therefore Google is able to integrate their solution in much more NFC enabled Android devices than Samsung Pay. This gives Android Pay the opportunity to reach a far greater number of users than Apple Pay or Samsung Pay.
Conclusion
Given the facts above, Google has the ability to make a mark in the mobile payment market. But it will be interesting to watch how Google will improve their Wallet and how they expand their partner network globally and not only in the US to offer mobile payments for consumers of different countries. With Android Pay they are able provide banks and merchants with a payment platform to integrate mobile payments in their existing or new banking applications. But will banks worldwide be willing to let Google and Apple take part in their payment ecosystem or not?
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