Mobile payment and wearable market connect with Barclays' tap and pay gloves

Friday 19 December 2014 | 14:49 CET | Background

Although the mobile payment market is still a market in development, a new related market is also emerging: the wearable payment market. Various companies are working on embedding payment capabilities into several wearable devices, with Barclaycard testing tap and pay gloves during the Christmas season in the UK.

Mid December Barclaycard announced that it is trialling ‘tap and pay’ gloves during the busy Christmas season as new method of payment. According to Barclaycard: “ ‘gloves you could pay with’ were voted the most popular wearable item consumers would like to see created, followed by rings in second place and bracelets in third”.  Barclaycard has developed a limited number of prototypes to be used in the trial. They can be tried at the 300,000 contactless terminals spread across the UK. The gloves are woollen and touch-screen enabled. They are embedded with the bPay contactless chip which can be linked to a credit or debit card and can be used for payments up to GBP 20. They work like the 45 million contactless cards circulating in the UK: consumers tap a contactless terminal with their glove and the payment is processed in an instant.  British consumers are increasingly using contactless payment methods, with GBP 2 billion expected to be spent via contactless in 2014.

Barclaycard expects the gloves to be popular with many consumers as their own survey indicated that nearly three-quarters of shoppers said that queuing when Christmas shopping was their biggest pet hate. Nearly one in five shoppers also stated that they often struggle to pay with their hands full of bags. Gloves came out on top of Barclaycard’s survey. The other wearable items which enable payment that British consumers would like to see created, were rings, bracelets, handbags, hats and scarfs.

Various companies are already working on developing these types of payment devices, such as the NFC Ring and Smarty Ring. Smartwatches are of course also an item with great potential for the payment market. The current Samsung Galaxy Gear doesn’t yet use NFC for payments but it already allows mobile commerce via apps. The Apple Watch is fitted with NFC and can be used for contactless payment, when coupled to an iPhone. While the iPhone 6 uses the fingerprint sensor to authenticate payment, Apple has not yet made clear how the Watch will do this. The specifications seem to suggest that the heart rate will be analysed as this is a unique pattern as well.

Disney has been using Magic Bands for a while in its parks. The Magic Bands are wristbands that facilitate payments and allow park patrons to access their hotel rooms and skip longer lines. Disney customers using the Magic Band need to enter a PIN code after touching the pad to identify themselves. Disney uses RF technology.

Next to Barclaycard, Mastercard has recently introduced its Nymi band, developed in cooperation with Bionym. Several MasterCard issuers will test the band in a pilot in Canada. The bands will be matched to the user's heart patterns, so only that person can use the watch, removing the need for other identification. The watch is activated when the user puts it on, and includes an NFC chip to communicate with contactless payment terminals.

Like with the payment industry via mobile phones it seems that many interested parties are trying to get into this new business.  As wearables are predicted to grow tremendously in the coming years, it may provide another way for payments to go mobile, whether via a mobile phone or a device which is mobile…

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