Thursday, August 13, 2015

CurrentC Doesn’t Stand a Chance Against Apple Pay

Don't expect CurrentC to gain much currency with consumers

Apparently, the Merchant Customer Exchange, or MCX for short, is planning a test run of its own mobile wallet, CurrentC.

MCX is a consortium of more than 60 big-name retailers from across the country, including industry giants such as Walmart (WMT), Best Buy (BBY), CVS (CVS), and Target (TGT). The CEO of MCX, Brian Mooney, described his vision for the future of smartphone payments, and he believes CurrentC will rise to become “one of the great competitors” in the mobile wallet arena.

Through its agreement with participating businesses, MCX was able toforce some of the country’s largest and most popular retailers to stop accepting competing mobile wallets and smartphone payment systems such as Google (GOOGL, GOOG) Wallet and Apple Pay, Apple’s (AAPL) virtual payment system that took the country by storm when it was released late last year.

However, in a bold move last April, Best Buy announced that Apple Pay would be accepted in both the Best Buy smartphone app and the retailer’s physical stores.

Further, MCX’s mobile wallet exclusivity clause expires later this month, and without a fully functioning version of CurrentC available, many participating retailers have already announced intentions to begin accepting Apple Pay, Google Wallet, and other digital payment systems such as PayPal (PYPL).

Can CurrentC Compete With Apple Pay?


In short, not a chance.

On paper, CurrentC sounds like a great concept with plenty of potential to stir things up in the mobile wallet arena. Unfortunately, MCX has had a rather difficult time getting the app to work properly, and the entire program came under fire last year when hackers obtained confidential data on CurrentC’s beta testers.

Even though news of yet another data breach seems almost commonplace these days, the public reaction to the possibility of security flaws in the MCX mobile wallet app was detrimental. As MacWorld.com put it:
“Given that CurrentC stores encrypted payment information in the cloud, and requires both a driver’s number and social security number for identity verification, users could reasonably be concerned about the group’s ability to keep that data safe.”
But, even more than the cumbersome personal identity requirements and the blemishing data breach, the most significant challenge faced by MCX in getting consumers to use CurrentC is the fact that the app itself will need to be downloaded and installed by customers.

Even though the process of installing new apps on iPhones and Android smartphones couldn’t be easier, it’s still something that requires extra effort on the part of the consumer, and let’s face it, people are lazy. Plus, with the recent onslaught of data breaches and rampant identity theft that have plagued some of the world’s largest companies, people have become extremely hesitant when it comes to divulging personal identity details such as drivers license and social security numbers.

With Apple Pay pre-loaded on new iPhones, and Google Wallet on most Android devices, shoppers are much more likely to trust and use those apps than a new program they’ve never heard of before. And, those consumers who choose to download a mobile wallet app instead are more likely to go with a name they know and trust, such as PayPal.

So, again, CurrentC doesn’t stand a chance against Apple Pay.

Bottom Line on CurrentC and Apple Pay


In theory, the MCX mobile wallet app CurrentC could present solid competition to Apple Pay, Google Wallet, and PayPal. But in reality, it will be a non-starter.

MCX is simply too far behind to catch up to Apple Pay, and the black marks against CurrentC are enough to scare away droves of shoppers paranoid about having their personal identities and banking information stolen. And, by the way, all of this is being discussed before we even have an actual working version of the CurrentC mobile wallet.

Article originally appeared on InvestorPlace (08/13/2015)