On the brewing battle between Apple Pay and CurrentC

There’s a major battle brewing in the payments industry. On one side, Apple Pay sits on top of the existing credit card model, adding a layer of anonymizing security and ease of use.

On the other side is CurrentC, the brainchild of a consortium called the Merchant Customer Exchange, or MCX. CurrentC seeks to eliminate the credit card companies, and their fees, from the system. CurrentC is an alternative to credit cards, not an add-on.

There are several core issues here.

First, there’s the mechanics of the system. With Apple Pay, you place your phone near an NFC sensor, then touch TouchID to validate the purchase. With CurrentC, you first have to unlock your phone, launch the CurrentC app, wait for it to generate a QR code which you place in front of the scanner. You then enter a pin code to complete the process.

In stores, Apple Pay requires an iPhone 6 or 6 Plus and a merchant with an NFC terminal. CurrentC won’t be available before next year, but will work with existing merchant equipment, whereas Apple Pay will require merchants that don’t have the proper terminals to upgrade.

Both Apple Pay and CurrentC are backed by powerful market forces. Apple Pay is backed by Apple, of course, as well as most banks and credit card companies and a long list of merchants. CurrentC is opposed by the credit card companies, since the goal of the Merchant Customer Exchange is to completely eliminate credit card swiping fees from the equation. According the New York Times, the Merchant Customer Exchange represents more than a trillion dollars in sales which, if my math is right, would eliminate more than $20 billion in credit card fees.

Those savings are certainly a big motivation. Another is the loss of customer data. Apple Pay is, in some respects, anonymous. From Bloomberg:

Here’s what Panera ultimately wants from its participation in any mobile-payments system: a speedier link to the MyPanera Rewards loyalty program, which is used in half of all purchases. When a customer pays now, she either hands over her loyalty card or tells the cashier her phone number. Mobile payments should be able remove that step.

Apple Pay, with its built-in anonymity, won’t eliminate the need to swipe a loyalty card or give the cashier a phone number. ”Obviously, that’s not where we want to be,” says Blaine Hurst, Panera’s executive vice president for technology and transformation. “Why can’t I just walk up to a cashier with my phone and all that information magically appears?”

Harvesting customer data is a two edged sword, with privacy concerns on one side, and loyalty benefits, more focused service on the other. Apple Pay does not prevent the use of loyalty cards and the like, but it does not build that data in. If Apple can find a way to allow the customer to fold that information in to the Apple Pay stream if they choose to, that will eliminate that issue.



  • I find it interesting to see lots of people saying, on Twitter, that they won’t shop at [store_name] because that store doesn’t take ApplePay. That’s quite short-sighted.

    On the other hand, it’s clear that the curiously-named CurrentC is all about saving money: that 3% that merchants pay on credit card sales is a big chunk of change, especially in low-margin stores like supermarkets.

    Some people are saying its clunky, but it will work on every model smartphone (as long as there’s an app available.) That seems to me a much larger population than just iPhone owners (and only iPhone 6 for now).

    I can’t imagine that Apple would be able to refuse to allow such an app on the App Store; that would be anti-competitive. It will be interesting how all this plays out.

    • shazbat

      Nonsense. I’ve switched my business to Walgreens (from Rite Aid). Apple Pay is more secure than a credit card swipe, and certainly no less convenient. Why shouldn’t people vote with their dollars?

      CurrentC will die because the user experience is unsound. No sane person will use a system that (a) takes more time than a credit card swipe and (b) gives retailers direct access to their checking account. We don’t even need to discuss the security problems with the CurrentC system.

      • BC2009

        You can sign a petition to ask President Obama to order the DOJ to investigate MCX for anti-competitive collusion here:

        http://wh.gov/icBmj

      • Sindustry

        Just because something looks better doesn’t mean it is. CurrentC fights the greedy money hungry corporations LIKE Apple and the Credit Card companies.

        The entire purpose of Apple Pay is for Apple to make .15% profit on all transactions. The entire purpose of CurrentC is to CIRCUMVENT the credit card taxation policies.

        Economically speaking, the business framework behind CurrentC is far more viable than Apple Pay.

        Bill Gates and Steve Jobs were both ugly, but that didn’t make them stupid.Regarding software. It can always be recoded. Just because the interface execution is poor does not mean the product is bad.

        People are so bent on being a FAN of a brand that they forget the whole point of these companies is to TAKE YOUR MONEY. it’s BUSINESS. It’s people’s JOB to do this. Not their hobby, or their dream, but their job.

        They’ve signed binding contracts that say they have to do this so they can do this. Yeah this is good right? Forcing each other to do things out of greed lol.

        Technology has done nothing but multiply ignorance apparently lol. Especially Apple with their “Keep THEM Stupid Simple” approach lol.

        • Benjamin Ing

          And for the poorly informed souls that choose to use CurrentC, I hope that you don’t bounce too many checks when a data breach at CurrentC allows hackers direct access to your bank account. Yes, CurrentC saves money by using ACH transactions that debit money directly from your bank account. No grace period, less protection and longer resolution for fraudulent charges that can tie up your money. But hey, those companies can say on their merchant fees and put them back into their pockets … after all, why drop prices when so many people are willing to pay the price now as it is?

          • Sindustry

            Yes and Ebola is a crisis too 😀

            1: If it’s plugged in, it’s insecure.

            As a computer engineer, I understand this rule of computers. The only secure computer is one that’s unplugged.

            2 You want to be forced to use Apple products to buy stuff in the future? Similar to being forced to use Internet Explorer on Windows?

            Because it’s more secure? Even if more secure is still insecure? Apple gets their fair share of data breaches as is, regardless of technology, so the whole be afraid of hackers thing doesn’t fly

            In the end, money is bullshit used to dictate value by ignoring opinion. Since value is based on opinion everything based on money is obviously bullshit. 🙂

        • Adam V

          The entire purpose of Apple Pay is for Apple to make .15% profit on all transactions.

          I thought the purpose (as far as I’m concerned) was “to make paying for stuff easier”.

          What do I care whether Apple gets a cut? Does it change anything for me? If CurrentC takes off, and the companies involved don’t have to pay credit card charges, are they going to lower prices as a result?

    • GFYantiapplezealots

      Why? I don’t shop at cash-only stores or places that charge me to use my credit card. It’s the only way they’ll get the message. CC charges should be a part of doing business, like rent. Screw these greedy businesses who don’t care about their customers.

      • One could say that the credit card companies are “greedy businesses.”

        You really don’t shop at cash-only stores? Wow…

        • GFYantiapplezealots

          You carry cash? Wow…

          Do you still write checks too?

          • I live in the UK, and have done for about a year and a half. I’ve written a few checks. Before that, I lived in France, and checks are the most common way of paying bills.

          • im in the US. i dont remember the last time i wrote a check (my checkbook is 10+ years old…thats how infrequently its used), and i rarely carry cash. i use a plastic Visa “checkcard” (similar to a debit card but no pin when using Visa auth network. also doubles as a pin-required debit card). i avoid restaurants and bars that insist on cash like the plague.

            i employ businesses and services that accommodate my lifestyle. i do not change my lifestyle to accommodate their business practices.

          • Sindustry

            1/100th of a credit card definitely has no value.

        • Shun

          i don’t go as far as GFYantiapplezealots, but I do avoid cash-only gas pumps in the US because I almost always don’t carry enough cash on me to fill up the tank!

          Also note hat this could be an American thing. I could live out a whole month on credit/card-only transactions at shops. No cash/checks necessary.

      • Mau Sandoval

        Couldn’t agree more. CurrentC passes the benefit to the business, not the customer. It is more of a hassle to the customer, not to mention that they are enjoying the harvesting of all those phones and SSNs.

        • matthewmaurice

          Indeed, the CurrentC system seems to put all the risk on the consumer and give all the advantage to the merchants.

          • BC2009

            Bingo… it is consumer-hostile

        • BC2009

          Don’t forget that your bank account and drivers license data is stored in their cloud. But it is safe because you have the likes of Target, Home Depot and Staples protecting it, right?

        • NoCurrentC

          Exactly, those that state it is a better business model are solely looking at it from the perspective of the corporation. I do not like the lack of security and privacy. I don’t need every merchant gathering data. Currently if I CHOOSE to use a loyalty card I am giving the permission. Credit cards have a maximum liability, ACH payments do not. CurrentC is all about merchant profit and removing choice. With ApplePay I have more security, an easier application, and complete CHOICE to use any of my cards including my checking account via a debit card. In addition the merchant gathers no data that I do not choose for them to have (by using a loyalty card).

          Since it is easier to swipe a card I will do that rather than CurrentC

        • Mau Sandoval
    • jehrler

      Since you are in the UK you may not realize the degree of fraud that has occurred in the US with Target/Home Depot/etc, etc.

      Because EMV is just rolling out having a tokenized system WITH $0 consumer liability for fraud at most banks (capped at $50 by law) is a win win for the credit card companies and the consumer.

      What protections MCX is offering, who will answer the calls and how fast fraudulent charges will be recredited to checking accounts is all very, very murky and not subject to current legislation.

      • BC2009

        Because CurrentC from MCX uses ACH transactions, the customer is liable if their CurrentC account gets hacked and used by somebody else.

        But don’t worry your PIN, checking account number, SSN and drivers license are stored safely in the cloud by IT experts hired by big companies like Target, Home Depot and Staples. What could go wrong?

        • jehrler

          I would imagine that MCX will offer some protections but, as I said, it is unclear and will not have the force of law.

    • lkalliance

      I find this interesting as well. This summary makes it a little more clear to me, and I see what MCX is trying to disrupt…they’re trying to disrupt the credit card companies’ influence, really just like Apple is trying to disrupt phone carriers’ influence as well.

      OK, so let’s assume that CurrentC gets implemented next year, and that the hoops to jump through are on a par with the current hoops. Currently you’ve got to pull out a loyalty card and a credit card, and with CurrentC you’ll have to launch the app and scan the QR code. Reasonable people can agree or disagree as to which is more convenient or less…but it would seem pretty clear that Apple Pay’s mechanics are easier.

      But CurrentC would be available on almost any phone. I could use it on my current iPhone 5c, for example (would that be my current c?). So there is that: wider base of users. If I’m scanning my loyalty card anyway, I’m not giving them any MORE data than I was giving them anyway (unless there’s more being hidden that I’m giving over), so privacy is a wash between the current procedure and the CurrentC one. There’s the question of whether you want to do it all through debit cards, whether you’re giving up fraud protection…

      But in the end it’s convenience, I think. A user feels that it’s no more convenient to use CurrentC than it is to just do it the normal way. He gets no other benefit either way. So the system doesn’t get used, and the credit card companies still get their 3%. The investment is for naught. And in the meantime as more Apple Pay phones become available (and as concurrently more Android users start using Google Wallet) this customer is going to see a differentiation where before there wasn’t one. “Rite Aid, Walgreen’s, doesn’t really matter. I just need toothpaste. Rite Aid is just around the corner.” But now there is a differentiator. Just how big of one is to be seen.

      This will be very interesting to see unfold.

    • BC2009

      “as long as there’s an app available”

      There in lies the rub. Apple already has rules about rejecting apps that duplicate iPhone functionality.

      “I can’t imagine that Apple would be able to refuse to allow such an app on the App Store; that would be anti-competitive”

      And you don’t see that competing merchants colluding in the only “merchant-owned mobile commerce network” (see mcx.com) as anti-competitive? In a free market system, banks and credit card companies would be able to offer rates to merchants individually and compete on terms. Indeed, AMEX charges higher rates than Visa and MasterCard but they typically wield a wealthier set of clients as well to justify it. By merchants colluding to block competing payment systems collectively they are being extremely anti-competitive.

      What if Visa card offered CVS a 1% transaction fee rate which is 1.5% better than Rite-Aid is getting? Should CVS decline because they are colluding with Rite-Aid through the intermediary of Merchant Customer Exchange (MCX) — which they co-own?

      It is fine for Target to do their Red-Card. What is not fine is for MCX to create a cross-merchant “Red-Card” in CurrentC. The mere fact that merchants are colluding to do this is anti-competitive. If MCX was an independent company then that would be fine, but it is not. It is owned by otherwise competing merchants in an attempt to unfairly bias the market for transactions.

      • AFAIK the only laws in the US regarding payments are that merchants must accept cash, and even that, perhaps only up to a certain amount. They are allowed to accept or refuse any other payment systems they want.

        • Meaux

          Nope. Merchants can accept what they want. There are plastic only restaurants.

          http://online.wsj.com/articles/SB125260838282300453

          • exactly. Cash is always a valid payment in this country, but you are not required to always accept cash. You just can’t declare cash is an invalid payment method.

          • Meaux

            Did you read the article? That restaurant only accepts plastic. The only way you can use cash is to tip staff.

          • which is why I wasn’t saying that you have to accept cash.

            I was pointing out that there is a difference between not accepting cash, which is okay, and saying cash isn’t a valid form of payment, which is not okay.

            you don’t HAVE to accept cash, just like you don’t HAVE to accept many valid forms of payment. You just can’t say cash is an invalid form of payment. It is an entirely valid form of payment, just one you choose not to accept.

            The difference is admittedly subtle, but real.

          • Meaux

            By that definition pretty much anything is “a” valid form of payment. Like the guy who turned the red paperclip into a house, you can barter any product for another product if you find the right person that will accept it as payment.

        • BC2009

          I made no statement about forms of payment that are required for merchants to accept, only that it is illegal for merchants to collude with one another — they don’t get to act like a union in a fair market economy.

          If CVS and Rite-Aid can claim they independently decided to make this move then that is one thing, but if they colluded (and co-ownership in MCX kinda makes that obvious) then they may have the DOJ to answer to.

          This would be just as illegal if Apple, B&N and Amazon got together and all agreed that they would not carry Hachette books until Hachette lowered their whole sale prices. You say “they are allowed to accept or refuse any other payment systems they want”. By the same notion, Apple, Amazon and B&N can refuse to sell any publisher’s books they choose. But if the three of them colluded to break Hachette’s back then that would be illegal. No difference here. The whole lot of MCX participants are guilty of collusion in my opinion.

          Rite-Aid and CVS are competitors and should not be allowed to collude or co-own an entity like MCX.

          • Meaux

            This is false. What do you think standards bodies are? They are competitors “colluding” to make joint decisions. And this leads to what they buy (and to a certain extent, what they won’t buy). Is it illegal for PC manufacturers to join together in a standards body to determine what USB is like and that they will use USB? If I was Apple with the IP for FireWire, I’d be mighty angry about Compaq, DEC, IBM, Intel, Microsoft, NEC, Intel and HP colluding and creating USB instead of my preferred standard. As long as competitors aren’t colluding on illegal price fixing, there’s nothing illegal with them working together on a mobile payments system.

            This isn’t to say I support what they’re doing, but your claims are patently false.

      • lochias

        “Therein lies the rub.” Not much of a rub. App Store under ‘currentC’.

      • alaska99801

        CurrentC apps are already on the app store and google play.

    • lochias

      “I can’t imagine that Apple would be able to refuse to allow such an app on the App Store; that would be anti-competitive.”

      Why would they not be ‘able’ to refuse anything they like? However, they haven’t. It’s MCX that’s keeping anyone from using the iPhone CurrentC app. It’s by invitation.

      • BC2009

        And if Apple and Amazon colluded to refuse to sell Hachette books until they lowered eBook prices, then that would be anti-competitive.

        Kinda like Rite-Aid and CVS colluding to promote MCX’s CurrentC since those two companies are co-owners in CurrentC which advertises itself as the “only merchant-owned mobile commerce network”.

        Email the DOJ at AskDOJ@usdoj.gov and request an investigation into MCX for collusion.

        • Sigivald

          Or not.

          Because “collusion” doesn’t mean “any time more than one company works with another one to their benefit”.

          There’s no price-fixing here. No bid-rigging. No market-splitting.

          They’re forming a competitive [with the CC processors] payment network.

          (Note that dozens and dozens of other companies are also thus “colluding” in your narrative, since the link you gave shows a lot of companies, not just pharmacies, and plenty of other pharmacies aren’t partners.

          At that point I don’t even know what you mean by “collusion”, especially under a framework of US anti-trust law.

          What part of the Sherman Act do you think they’re violating?)

          (Then again, I’m such a free marketer that I think all the anti-trust laws should be thrown out as worse than the thing they try to fix.)

          • BC2009

            They are trying to fix the price of electronic transactions by colluding to put Visa, MasterCard and American Express out of business.

            The banks in this case are suppliers of an electronic transaction service.

            If you were to turn this around and see the banks as a publisher like Hachette, then how would this be different than if Apple and Amazon joined forces to put Hachette out of bussiness by agreeing to refuse to buy books from them?

            The merchants are colluding to agree to force out the banks.

            So the fair market price of electronic transactions is being rigged by the merchants.

            As far as “free market” goes, I am all for it. Let Apple and Google simply pull the CurrentC app from their app stores. However, folks on here are suggesting that doing so would be “anti-competitive”, which is a joke compared to a bunch of merchants acting like a union.

          • Meaux

            They aren’t trying to fix the price of electronic transactions because they aren’t price setters in that market, they’re price takers.

    • rick gregory

      1) I won’t shop at stores that have deliberately disabled Apple Pay. RiteAid, CVS and more have done this (note that this affects Android users of Google Wallet too – these stores are refusing all NFC payments). Taking this action says to me that the store cares more about forcing its solution than letting me pay in the manner I want. This leads to point 2….

      2) I don’t care about the stores’ interests, I care about mine. I don’t for a minute believe that I’ll get the 3% back in the form of reduced prices.

      3) Unless these stores stop taking credit and debit cards entirely, they’re not going to eliminate fees on those, merely reduce them by the amount of people who use CurrentC. Look at the process outlined above and ask y9ourself how many people will do all of that vs swiping a card? Right.

      4) CurrentC seems to require access to my bank account. Imagine if Target or Home Depot had this when they got hacked. Retailers have zero credibility when it comes to IT security.

      5) And when they do get hacked… what are the fraud protections if someone drains my checking account? US laws apply to credit and debit cards. Are the merchants going to absorb these losses? if so, how since they aren’t charging transaction fees (part of the 3% for CC fees goes to fraud and loss issues)? If not, then the merchants are telling me I have to absorb this risk. See point #2.

    • imthedude

      On the other hand, it’s clear that the curiously-named CurrentC is all about saving money: that 3% that merchants pay on credit card sales is a big chunk of change, especially in low-margin stores like supermarkets.

      They don’t take credit cards. Was MCX able to convince retailers people love paying with cash? That single oversight, has killed this before it began.

      Some people are saying its clunky, but it will work on every model smartphone (as long as there’s an app available.) That seems to me a much larger population than just iPhone owners (and only iPhone 6 for now).

      You already forget google wallet, which also works on NFC terminals with Apple pay. Further than that, this system is more clunky than just going in your wallet and fishing out a debit card.

      Now you can also talk about their data collection (ridiculous), or their need for SSN’s and drivers license numbers. We should hand that over to some nobody, because retailers want to save money? Count me out, I will never use Currentc. Mark my words, this will be dead and the only ones making out on this will be MCX and the $500k they charged these companies to be part of this.

      P.S. Currentc leaves people responsible for any charges made on their phones, and offers no protection from retailers like a credit card will.

    • Darwin

      Your comment is ridiculous. Of course people should choose to shop elsewhere. Are you being paid off by someone to promote the garbage?

    • Mau Sandoval

      Nonsense. Since the merchants are “saving” the 2-3% on CC processing fees, that means someone has to pay those fees… call it ACH, call it whatever.

      How is CurrentC giving this awesome (not) low cost service to merchants? Your data… with Apple Pay, the merchant doesn’t get your name, not even your CC number gets to the merchant. With CurrentC, MCX gets your Social Security Number (WTF), your driver’s license, AND your checking account. No Effing Way.

      Shortsightedness is already taking its toll and by not learning from what happened to the Targets, the Home Depots regarding security breaches, they pretty much just shot themselves on the foot.

  • shazbat

    “If Apple can find a way to allow the customer to fold that information in to the Apple Pay stream if they choose to, that will eliminate that issue.”

    What a horrible thought. What loyalty benefits? No, thanks.

  • Dot

    The CurrentC sounds like a debit card rather than a credit card and, if so, will deter a lot of people who depend on charging and paying off over time. Plus, I don’t want to give the system direct access to my bank account. I don’t mind the merchants trying to cut out the middle man but do they also intend to insure me against fraud?

    • Mau Sandoval

      It is a debit card. It links to your checking account directly. Not to mention that it requires you to enter your phone number AND your social security number when signing up. Magical.

      • jehrler

        Not really. MCX initiates an ACH transaction. What protections for consumers and their checking accounts when fraud occurs is a really open question. Plus, unlike a credit card, you will potentially have bounced check fees from both your bank/credit union and the retailers.

        • Mau Sandoval

          agreed. saying it is a debit card was extreme. But I still uphold the idea of it being a higher risk of data theft since you have to share your damn SSN and phone number with them. No way.

          • jehrler

            Absolutely. This is a disaster waiting to happen with customers’ checking accounts being plundered with very unclear liability responsibility.

            Customers not being liable for fraudulent transactions is a big part of what VI/MC/AX/DI use their interchange fees for.

            I, for one, would not want to be at the mercy of Walmart if my checking account has been cleaned out by fraud and have 100s of dollars in NSF charges to boot.

          • Mau Sandoval
        • ACH is bank-to-bank, so if there is any fraud involved by a merchant initiating an unauthorised ACH direct debit on an account, then surely that merchant’s banker would ultimately be liable …

          • jehrler

            That is true. Except as part of the MCX signup process I will be giving them the authority to debit my checking account via ACH.

            Fraudulent hacked use of the MCX info does NOT represent fraud on the part of MCX, the retailer, their bank, me or my bank.

            Rather it is fraud perpetrated by another party via the MCX mechanism.

            So, really, it is kind of like a utility double charging you via ACH. You gave the permission for the charge, so now you have to go to the utility to get it reversed.

            EXCEPT this is worse, because unlike the utility, MCX potentially did nothing wrong…it was the other criminal party.

            So who should bear that risk? That has nothing to do with the banks and everything to do with your contract with MCX.

            And this does not even begin to touch any NSF fees that accrue due to the fraud.

            Caveat Emptor!

          • You are right, if you have given CurrentC an ongoing permission to direct debit your bank account then any recouse would have to be via the merchant, and that could be problematic compared to the transaction mediation provided by the credit cards … Still, I suppose that it’s always possible that one day pigs may develop the ability to fly …

      • matthewmaurice

        I think it’s a bad idea to think of CurrenC as a “debit card”, especially for those who have been using Visa or MasterCard debit cards. The CurrenC is really an online payment system that is linked directly to your checking account. For one thing, it doesn’t seem to have any of the consumer protections offered by Visa/MC, and for another it has 0 track record, unlike PayPal.

        • Mau Sandoval

          Yup, the closest I’ve seen to it (in my experience) is Square’s Wallet… and that didn’t go anywhere.

          Since PayPal is not bound by the rules of banking, I avoid them like the plague.

          • matthewmaurice

            The thing I like about PayPal is that they have a LOT to lose, especially after they’re spun-off from eBay. PayPal is motivated by pure survival to treat their customers well, and that makes me feel safer using them. That being said, I still limit their access to my credit cards and secondary checking account.

          • 1) square wallet is linked to your credit card. mine uses my visa checkcard.

            2) square wallet is/was great. i walk into a favorite restaurant that uses Square as their POS, and i dont even need to remove my wallet — they see me on their end and can tap my face. my phone then pushes a notification to open the app and set the tip. perfect.

          • Mau Sandoval

            Yes, it is linked to a card. And I agree, it was great, but still didn’t go anywhere (http://www.theverge.com/2014/5/12/5709256/square-kills-square-wallet-tries-again-with-square-order). I still use it every now and then at Starbucks, since they are still letting you use it.

  • Apple has (or at least recently had) a job listing with a line of “come build the next generation of loyalty programs.”

    If Apple follows its typical behavior, I bet it’s working on adding the choice of sharing loyalty information to the equation (and perhaps automatically opting into programs altogether, right from your device). Newsstand could serve as a great precursor and example.

    Set aside Newsstand’s problems and look at one of its great successes: consumer choice to share information with publishers. The first time you run a new publication, you’re prompted with a request to share a few standard bits of information with the publisher (I believe name, email, and age?). You can say yes or no.

    This model could easily be applied to Apple Pay. You do your thing at the register, and immediately after a prompt appears to opt into the company’s loyalty program because you’ll get X, Y, and Z benefits. You can walk away, think about it, and choose to opt in on your own time.

    Another major benefit here is that you don’t have to repeatedly fill out endless forms. The opt-in process just uses a basic set of info (either from your Contacts card or entered directly into Passbook).

    One-tap opt into loyalty programs and choice in the palm of consumers’ hands. Everybody wins.

    • Sigivald

      If anyone out there could make Loyalty programs not suck, it’d be Apple.

      (If I’m really lucky, they’ll make the API nice and make my work life easier, too.)

  • kiggle

    I am attempting to get #PayItSafe trending on twitter with support from both the Google/Android and Apple/iPhone communities. Please take to twitter and let the companies disabling NFC know that we are not happy about their decision to not let us #PayItSafe – and please retweet these tweets. Lets get our message across! https://twitter.com/search?q=%23PayItSafe&src=typd

  • Tim W

    Hmm – I wonder how we could make the use of customer loyalty cards easier… I wish it was possible to store such cards or passes in a convenient place on your apple phone. They should call this the passbook – a place to store your passes and loyalty cards. You could even use it for your boarding passes…

    • Jim McPherson

      Apple Pay 2.0? The problem with passbook in its current form is that it relies on bar codes / QR codes which most merchants (rather ironically in the face of CurrentC) can’t currently accept. It would be nice if with one touch I can send over my loyalty information AND my payment information.

  • The problems with CurrentC are rather large:

    1) All data stored in the cloud. In and of itself, this is neither bad nor good, but merchants do NOT have a good record in terms of data security.

    2) By using ACH from your checking account, you lose a lot of the fraud protection you get with credit cards.

    3) CurrentC requires both a Driver’s License & Social Security # for ACH. This doesn’t make a lot of sense, and again, security issues make it really hard to be okay with this. That CurrentC cloud data storage will be the most attacked data storage in history.

    4) There are two purposes here: 1) avoid fees. 2) Be able to more directly market at me because they’ll have a detailed, non-anonymized list of purchases I make.

    No thanks. I’m not going to be all “I’m not shopping there”, but I’m most definitely not using currentC. The risks are currently too high for zero reward.

    • jehrler

      As I mentioned above, you are also at risk of NSF fees from both your bank/credit union and the retailers if fraudulent transactions deplete your checking account.

    • matthewmaurice

      “Driver’s License & Social Security #” Are the Holy Grail for fraudsters. Add in a birthdate and/or current address and you’ve got all the tools you need for a painful, and potentially expensive, Identity Theft experience. Yeah, it’s a low probability, but if the ‘long shot comes in,’ you’re ‘well and truly!’

      • BC2009

        The probability is not low at all. If all that information is one place, hackers will find a zero-day vulnerability in their system early on and will mine data for years before the hack gets known. When CurrentC goes live as version 1.0, it will likely have plenty of bugs to exploit. It will be unproven and yet will be highly targeted. A hacker looking for an identity theft gold mine would have no better place to focus his efforts.

        If SSL3 and OpenSSL and a host of other supposedly secure solutions were in fact vulnerable for over a decade after extensive use and testing, how vulnerable do you think the 1.0 version of a far more complex web service for payments is going to be — especially one created by a collusion of merchants with competing interests?

    • G

      tl;dr? See John’s comment. The only way CurrenC would be easier to use than a CC or debit card would be if one could swipe the phone through the terminal reader. Kills any dreams Apple may have to make the iPhone as thin as a credit card.

      • BjornSM

        Swipe?

        Are you suggesting to repeat the ugly mess of crooks “swiping” the magnetic strip on your card/phone and using the data to make duplicate cards for cleaning out your account at maximum speed?

        • G

          Yes, as sarcasm.

          • BjornSM

            :O)

  • Jim McPherson

    An interesting factor in this is that no matter what happens, credit cards aren’t going to die by the end of 2015, and financial networks are requiring NFC payments to be accepted by the end of 2015 (by passing fraud on to the merchant if the merchant doesn’t accept them). The CurrentC Cartel is trying desperately to negate Apple Pay’s “first mover” advantage*, but I don’t see how they have a choice but to acquiesce eventually. They may be trying to buy some time for their own solution to gain some momentum, but in its current form I can’t see anyone except the executives of the sponsoring companies using it.

    *Recognizing, of course, that Apple didn’t exactly invent NFC payments, but they have created the first implementation that a critical mass of consumers actually care about.

    • jehrler

      It’s not NFC per se that is required to avoid the 10/2015 ship, just readers that have the capability to match the type of card the customer has, be it chip and pin, chip and signature, NFC or just magnetic stripe.

      If a customer presents a higher security card and the reader only accepts a lower security type, then the retailer assumes liability come 10/2015.

      • Jim McPherson

        “Chip” is different from NFC here? How is the chip used then?

        • jehrler

          It is an on credit card microprocessor that can create encrypted cryptograms, keep a counter for transactions, etc.

          In the US it is most of the cards you see now that have the gold chip. They are EMV compliant (most are chip and signature rather than chip and pin…if it is chip and pin they often have the pin burned into the microprocessor and not user changeable). These are not NFC so when using an EMV reader the card goes into a slot where the chip’s contacts touch the readers contacts to pass the necessary encrypted info.

          For NFC cards you will see the same chip (as NFC is also EMV compliant) plus a surrounding bunch of lines that are used to send/receive the encrypted data via radio waves.

          • Yes, and Europe, South America, and most other countries/continents have had chip-and-pin for years. When I visited Europe in 2013, I had trouble with my swipe credit cards in most places I went. (Luckily, I’d taken cash to convert and carry.) Chip-and-pin credit cards, and now more secure NFC in the form of ApplePay and Google Wallet, etc., can’t come soon enough to the USA for me.

      • Zaph

        There are no current plans for chip & pin in the US, just chip and signature. While there are some chip and pin cards available, Barclaycard and a couple of military affiliated credit unions, the cards work as chip & signature in the US. Even in Europe the chip and pin cards default to chip and signature if possible. The US is only a little over 10 years behind.

        • jehrler

          Not true. Both my new Wells Fargo Platinum Card and Credit Union Visa are both Chip and Pin.

          • Zaph

            When we say chip & pin we do not mean pin used for cash advances, we mean for credit card purchases. If you use the card in a chip reader for a credit card purchase does it ask for a pin or a signature.

          • jehrler

            Pin, assuming there is a Chip reader.

            These are the real McCoy, world-wide compatible chip and pin cards.

            Most banks aren’t doing this but some, in fact, are.

          • Zaph

            You have used it in a chip reader and entered a pin instead of a signature and it was used as a credit card in the US? Is the credit card union military affiliated?

          • jehrler

            Airline. Used to be the NWA Federal Credit Union, now Wings Financial. So lot of international travelers. But the Wells Fargo Card is just a normal renewal of my non-chipped card.

          • Zaph

            I will have to get a Wells Fargo card! Then see how it works in Europe, as I stated Barclaycard defaults to signature, not what I want, it is a hassle, they generally have to make a second trip for a pen.

            Have you tried it in a chip reader in a grocery store? Just looking for information.

          • Zaph

            From the Wells Fargo site it looks like it defaults to signature:

            When will I be prompted for a PIN? You’ll be prompted for a PIN when requesting cash advances at ATMs worldwide and when making purchases at some payment terminals abroad.

          • jehrler

            Our local grocery (as are most of the merchants near us) are still using swipes.

            Here is the link to the one we have. NFC, Chip and Pin, no fee (no rewards tho):

            https://www.wellsfargo.com/credit-cards/platinum-visa/

          • jehrler

            It does default to signature as that is going to be the US default for now. This is up to the retailer in the US and that is what they are going with.

            However, if a pin is required (most places outside the US) it will, in fact, have the requisite pin burned into the card to allow it to work without complaint.

          • zaph

            The link I am reading: https://www.wellsfargo.com/credit-cards/features/chip-card/faqs/

            I find that most of the readers here in the larger merchants do have a card slot, sometimes somewhat hidden under the keypad. Most do work with with a chip card, HomeDepot does not.

            My interest is in Europe. At least a chip and signature card will work most everywhere but not in unattended machines like a ticket machine in an airport to by a train ticket to town, not a great situation late at night. A card like your WF and my BC should work in that situation but not most US chip cards like my BofA.

            Stripe cards usually work, occasionally they won’t like when you need to buy gas. Or when we were in a restaurant with several others and we three US guys only had stripe cards, no local currency yet and none of our cards were accepted! We had to borrow money from our UK colleagues.

            The above are reasons I need to make sure.

          • jehrler

            I missed that you BarclayCard defaults to signature as well.

            I think this is a function of the retailers POS system. Since pin cards are rare in the US, I can’t imagine any retailer defaulting/requiring pin any time soon.

            I misunderstood what you were looking for. Many banks are issuing chip cards that only do signature, even if the POS system asks for pin. I thought that was your issue.

            The Wells Fargo, Wings and your BarclayCard have the pin capability.

          • Zaph

            I spent an hour on the phone with Barclaycard through three levels of support reps. They kept blaming it on the merchants but could not reconcile that all the other customers were asked for their PIN. Finally I reached one who told me that it defaulted to signature if possible. It looks like WF is the same, perhaps they think we Americans aren’t up to a PIN. 😉 I have not had the need or ability to try the card in an unattended terminal with the PIN yet, next trip.

        • EMV (PIN-free up to $100) is mandated now in Australia; if the merchant accepts a swipe+signature, they take the liability; indeed, I don’t think that an EMV card can be swiped except in a non-EMV terminal …

          Regardless, the whole concept of chip+signature was always an absurdity and will surely fade away, very quietly …

  • Chris Johnston

    I have no beef with the existence of CurrentC. If retailers think they have a better system, fine, try it. But pulling/deactivating NFC readers that were working with Google Wallet / Apple Pay just because they “have something in the works for 2015” – that’s what i object to. While I may not stop shopping at those locations, I don’t look upon that favorably. 🙂

    • matthewmaurice

      I think awareness of this is still limited to tech-centrics, but the ‘optics’ are awful for for CurrenC in general and Rite Aid & CVS in specific. So if the story makes it to more mainstream media, as almost anything Apple-related seems to nowadays, it may prompt some backpedalling. Let’s not forget this also effects Google Wallet, so it really looks like the CurrenC consortium is motivated to inconvenience ALL smartphone users wanting to use online payments until it can provide them with own, heavily merchant-advantaged, service at some, nebulous, point in the future. Not a good way to endear yourself to your customers in a particularly competitive marketplace.

    • BC2009

      Accept both and let the customer choose the winner.

      However, these current tactics to collude to block Apple Pay and Google Wallet should be investigated by the DOJ and should be answered by Apple and Google by removal of the CurrentC app from he App Store and Play Store, respectively.

      I encourage folks to request an investigation into the collusion of competing merchants from the DOJ by emailing them at AskDOJ@usdoj.gov

      • lochias

        If stores using MCX want to use the stupid thing, why is it DOJ business? The stores are, among other things, using the low bidder for processing their sales transactions.

        Keeping NFC forces on them credit card expenses that they certainly have a legal right to refuse.

        • BjornSM

          What 2-3%?

          Those are Card Not Present rates (phone and online orders) for these chains.

          I doubt they pay more than 1.6% tops for Card Present transactions.

          • I doubt the big boys are paying any more than ~0.05% …

        • GFYantiapplezealots

          Oh well. They also have to heat the place and keep it maintained and clean. It’s the cost of doing business. If the place is cash-only, dirty, and has horrible customer service because they pay low wages, then I’m not going there.

  • Gandhi

    Problem I have is giving CurrentC direct access to my checking account. I see some of the merchants on their list are the same ones that had data breaches (Target). I had to replace three of my credit cards because of that Target hack. Minor inconvenience, but the card issuer took care of it and I did not have to pay for any of the fraudulent charges. In fact, the card issuer contacted me because of suspicious charge activity on my credit card and wanted to verify. I only check my credit card transactions about once a week, so if it were not for the issuer, the damage would have been much more expensive and extensive.

    First, why would I even trust the likes of Target with my bank account when they have a demonstrated an inability to protect my financial info? Second, are these merchants going to back me up and refund my bank account when their system is hacked and someone cleans out my bank account? I have direct payments set up for important things like my car payments and mortgage payments. What happens when my bank account gets cleaned out because of fraud and I miss these important payments? Will these merchants even care, much less back me up?

    Yeah, good luck with that – MerchantC is dead in the water. I am NOT going to give them direct access to bank account, and sure as hell not giving them my SSN. There is a reason why I do not even have a debit card, even though my bank tries its darn hardest to sign me up for one.

    Also, what happens when I want to make large purchases like furniture and don’t have enough cash in my bank account? I carry a relatively low balance in my checking account because of the pitiful interest the bank give me. Rest of my money gets put in investments and such, where it has a better chance of actually growing.

    Seems these CurrentC folks have not thought at all about how their customers make purchases in their stores. This won’t go far at all.

    In fact, I will be so bold as to predict that the total number of users using Apple Pay on day one of its roll out last week will exceed the total life time users of CurrentC.

  • Shri

    “In stores, Apple Pay requires an iPhone 6 or 6 Plus and a merchant with an NFC terminal.”

    Let’s not forget that ApplePay will soon work with iPhone 5/5c/5s in tandem with the Apple Watch. Most likely, the Apple Watch will be released long before CurrentC goes live.

  • itsgene

    You missed a step in the CurrentC transaction: after you open the app, you have to take a photo of a QR Code generated by the retailer (one assumes on the POS screen); then your app transmits that back to the servers and brings back a different QR Code that is scanned at the register.

    Another good point worth noting: this means that you must have a network connection to use this purchase method. I don’t know about other people, but I can’t get any signal in big box stores like Best Buy or Target. On top of this, you’re transmitting your personal info, drivers license info, health info, etc. over an insecure connection. (Not that the retailer’s internal network is that secure.)

    In every possible way, this system is consumer-hostile. Poor security, gathers personal info, creates a dossier on you that can be shared with everyone from the retailer to app developers, makes you use YOUR data connection, reaches directly into your bank account, putting the responsibility for fraud directly on your shoulders and eliminating credit card transaction fees. No wonder these retailers are going for this!

    • Zaph

      Note that Google Wallet also requires an Internet connection.

  • Really, it won’t be a “battle” with Pay.

    It’ll be a “when does CurrentC collapse” watch.

    From what I read CurrentC is such a kludge that it has little chance of succeeding. How long will retailers stick with it as it struggles along?

    Plus, with so many retailers compromising the more easily disposed of credit card numbers, trusting them with bank accounts that don’t have a tradition of refunding fraudulent transactions, trust will be an issue (or it will be if people start losing their money to fraud that would have been covered if done by credit card)

  • L.A. Lady

    CurrentC doesn’t use credit cards and so it would be useless for me. I’m wondering if all of the disabling of NFC is due to some kind of agreement with CurrentC.

  • Andrew Munster

    This also effects the google payment system that uses NFC as well not just ApplePay.

  • As a consumer in the US, I am better protected using my Credit Card (and especially so in conjunction with Apple Pay) than I would EVER be with CurrentC, which can only be tied to a debit card.

  • One thing i’ll point out is that you can make QR code-based systems as easy to use as Apple Pay. You’d have to use them in conjunction with things like iBeacons, but the ease of use issue is solvable, and relatively easily.

    The problems with, and reasons to reject CurrentC are not small, but ease of use really isn’t one of them.

  • alaska99801

    Kirk, the apps are already in the app store and google play. Remember that it isnt just apple pay being refused, it is also google wallet. They are turning off NFC. That makes any other form of payment impossible in those stores. The kicker always will be what the customers want. Tying checking accounts to the currentc form of payment is troubling to me. It becomes another layer for thieves to try to obtain.

  • Anyone have an issue w/ Apple blocking all other NFC payment solutions by locking down NFC for their use only?

    [just curious, don’t flame]

    • lochias

      How would Apple do any such thing? It’s not their terminal, not their company at the other end.

      • NFC on iPhone 6/+’s are locked down to only Apple using them. They blocked every competitor from using NFC on their devices.

        This isn’t about terminals.

        • lochias

          Sorry, i didn’t know you meant on the phone itself. But why would you want to? Wallet was great three years ago, but it is kind of a kludge, and frankly too much work, opening an app, needing a pin. That’s the problem with currentC, even beyond the opening-your-bank-account thing: it’s one too many steps each time.

  • Sigivald

    CurrentC won’t be available before next year, but will work with existing merchant equipment, whereas Apple Pay will require merchants that don’t have the proper terminals to upgrade.

    Gruber’s writeup seems to indicate that ApplePay works with most NFC/Contactless readers, which pretty much everyone’s going to have by next year anyway, when Chip-and-Pin or equivalent is mandated [for people who don’t want fraud liability] by the processing companies.

    (Gruber even talks about Rite Aid turning off their contactless readers to shut out ApplePay, suggesting it worked transparently with their backend, exactly as it was intended to.

    I don’t think existing equipment is going to be compelling as of 2015, when the liability changeover happens for legacy card readers.

    Contactless readers are on the verge of ubiquity.)

    Combine that with the way the UX is vastly inferior, and merchant-pleasing, not customer-pleasing, and you have a recipe for failure.

    But on the other hand, per Gruber, it seems to be a thing pharmacies are pushing, and they survive generally-terrible UX through their entire retail process.

    I guess sick people are a captive market, combined with the pharmacist monopoly and the way insurance providers won’t pay out a red cent more for a positive customer experience…

  • satcomer

    I vote with my dollars, that simple. Bad move for this and I will not shop at thses business unless desperate. Plus rarely I get store cards unless in is a grocery store I use for the automatic coupons.

  • Aside from the dumpster fire that is CurrentC, if stores like Panera are so concerned about getting loyalty cards, just use Passbook. Problem solved – without having to use an awful, clunky, insecure payment solution.

  • James

    I’m surprised by the repeated assertion that merchants are looking to save the “3%” or more in transaction fees on credit card payments. Transaction fees are negotiated between the merchant and the payment facility provider. If I can negotiate 1.1% for a small medical office here in Australia, surely Walmart can do better than 3%.

  • Apple Pay—the greatest media/marketing beat up yet of the 21st century!

    Too bad all that hot air will soon enough cool …

    Retail Payments (and Apple Pay)—The Reality … http://bit.ly/1nSA1Zl

  • “CurrentC”? The MCX mob are delusional …

    And you can bet on it; Walmart and the like are more likely paying ~0.5%, and still that’s too much for them …

    http://www.ecommercebytes.com/forums/vbulletin/showthread.php?25316-Retail-Payments-The-Reality&p=169301#post169301