Saturday , June 3, 2023

11th Annual Field Guide to Alternative Payments

Churn is still the overarching theme in a dynamic market dominated by mobile options and eyeing digital currency.

You can tell a lot about the dynamism of a market by how often its players turn over—how many new companies enter the market from year to year and how many fail or fade into the background. By this measure, digital payments is one of the most dynamic of markets. We noted last year that the churn had been such that just three entrants from our original guide in 2009 were still on the list. Those three are still here, but now, in this year’s edition, we can note that four entries among the 34 that follow are entirely new to the guide.

Still, some overarching themes continue to hold true. We continue to see a heavy reliance on fully digital platforms aimed at mobile devices. A tipoff to this longstanding trend is the number of services using the “X Pay” formula as their naming convention. This year, that group includes two imports from China, Alipay and WeChat Pay, that are making major efforts to sign up U.S. merchants so users will have places to wield their wallets when they travel here.

Another trend worthy of note is the rising importance of digital currency. Crypto has had a rough year, but its wallet providers, exchanges, and trading platforms show remarkable persistence against considerable obstacles. You can see who’s done what lately in this fascinating market in the entries for Bitcoin, Circle Internet Financial, Coinbase, Litecoin, and Ripple.

As in prior years, Digital Transactions generally defines an alternative-payment system as any network or consumer interface (a mobile app, for example) that displaces the Visa/MasterCard/AmEx/Discover networks (seen as one traditional system for this purpose), enables payments in a way that stands apart from that network (even if it ultimately uses it), and/or stands between that network and the consumer in an important way. We emphasize consumer-facing payment systems, but of course many, if not most, of the systems profiled here market themselves to merchants to maximize acceptance of their products.

Information for the listings comes from news reports over the past year, company Web sites and spokespersons, and financial filings in a few cases. We list pricing for the merchant and consumer when it is relevant and publicly available. The “Year Founded” line refers to the year the particular service was founded, not the parent company, except in those cases where the two coincide.


Parent: Ant Financial Services Group

HQ: Pudong, Shanghai, China

Founded: 2004


Field Notes: Ant Financial’s fabulously successful mobile-payments service is making a major play for U.S.  merchants. The reason: It wants to cater to the 3 million Chinese tourists who visit the United States each year, spending more than $30 billion. Alipay also needs to find more markets outside China, where it and homegrown rival WcChat Pay have sewn up more than 90% of domestic mobile-payments volume. For now, Alipay claims more than 700 million active users who interact with merchants by scanning quick-response codes with their phones.


Amazon Pay

Parent: Inc.

HQ: Seattle

Founded: 2007 (including predecessor services)


Field Notes: Amazon Pay, which claims at least 33 million users, depends on the card credentials Amazon shoppers have stored with the massive online retailer over the years, some of whom are among the company’s 100 million Prime members. Lately, Amazon Pay has been working to expand beyond pure e-commerce with eateries like TGI Fridays. Users can order ahead using the Amazon Pay feature in the Amazon app and show up later to pick up their meal. In the online realm, Amazon cut a deal in March with Worldpay, the nation’s second-largest merchant processor, to handle acquiring and provide a gateway for Amazon Pay. That deal, which enlists Worldpay as Amazon Pay’s first-ever acquirer, could grow even larger in importance with the pending $43-billion acquisition of Worldpay by Fidelity National Information Services Inc.


Apple Pay

Parent: Apple Inc.

HQ: Cupertino, Calif.

Founded: 2014


Field Notes: Apple Pay’s position at the top of the mobile-payment pile is solid, though not for lack of effort by its competitors. Across the globe, 43% of iPhone users have enabled Apple Pay, says Loup Ventures, up from 36% in 2018. The big news, however, is the growing number of merchants that formerly resisted the near-field communication-based service. In early 2019, Apple said Target Corp., Taco Bell, and two regional chains would add Apple Pay acceptance at the point of sale. Target, formerly part of a failed merchant-led proprietary wallet called CurrentC, also added support for Samsung Pay and Google Pay. It also added support for contactless cards, which use the same NFC technology as Apple Pay. The volume of Apple Pay transactions exceeded 1.8 billion in Apple’s fiscal first quarter ended Dec. 31, more than twice the volume from the year prior, the company said. Most recently, Apple announced the Apple Card, a cobranded credit card issued by Goldman Sachs Group Inc. The card takes a digital-first approach, with deep integration into Apple Wallet. The physical version of the card has a contact chip, but lacks a contactless antenna for POS transactions. Instead, it prompts cardholders to use the card in Apple Pay with their iPhones or Apple Watch.



Parent: Satoshi Nakamoto

HQ: not applicable

Founded: 2009


Pricing: Miners’ transaction fees are volatile and paid by user

Field Notes: What to make of Bitcoin? For years, the blockchain product has tantalized users and merchants alike with its promise of cheap, irrevocable, and fast transactions. But it remains a specialized currency with high volatility in both value and transaction cost—and with at times painfully slow transaction times. Still, Bitcoin remains tantalizing. Independent sales organizations are starting to figure out ways to sell it to merchants, and a new, off-chain channel shows promise in speeding up transactions. Will 2019 be a breakthrough year for Bitcoin? Much depends on whether it can shore up its position as both a store of value and a medium of exchange.


Cash App

Parent: Square Inc.

HQ: San Francisco

Founded: 2012


Field Notes: Cash App, formerly Square Cash, is the Square Inc.’s person-to-person payments service. In one year, the number of Cash App users went from 7 million to 15 million. That’s still well behind the 100 million consumers using the bank-controlled Zelle service, but the growth in Cash App is particularly gratifying for Square, as it plays into the company’s emphasis on financial services for both consumers and merchants, Square executives said earlier this year. Cash App, which links to a Visa debit card to let users spend funds at merchants, competes with PayPal Holdings Inc.’s fast-growing Venmo service, in addition to Zelle, a bank-controlled P2P payments service. Spending on the Cash Card stood at $3 billion annualized as of the second quarter, the last period for which the company disclosed the statistic.


Circle Internet Financial

Parent: Circle Internet Financial Ltd.

HQ: Boston

Founded: 2013


Field Notes: It’s one of the quietest payments providers, yet Circle operates in one of the hottest fields in payments—peer-to-peer payments, both local and cross-border, with Circle Pay—as well as in the coming field of cryptocurrency. And last year it began giving voice to even bigger ambitions, including seeking a federal banking license. One of its latest moves, in March, was to launch a more powerful version of its trading app from Poloniex, a token exchange it acquired early last year.



Parent: Coinbase Inc.

HQ: San Francisco

Founded: 2012


Pricing: Varies by region and purchase type; $100 Bitcoin purchase funded with U.S. bank account or Coinbase wallet costs $2.99 while credit or debit card funding would incur a fee of 3.99%.

Field Notes: Often called the leading cryptocurrency exchange, Coinbase claims to have more than 20 million users and traded more than $150 billion in cryptocurrency. The company’s growth has propelled it into the ranks of unicorns—approximately 300 privately held startups worldwide with a valuation of $1 billion or more. Investment tracker CB Insights pegged Coinbase at $1.6 billion in January. In March, Coinbase announced it now supports Ripple’s XRP currency. And in April it introduced the Visa-branded Coinbase Card in the United Kingdom, a prepaid card that enables cardholders to spend using cryptocurrency, which is instantly converted to fiat currency to complete the purchase.


Cumberland Farms

Parent: Cumberland Farms Inc.

Headquarters: Westborough, Mass.

Founded: 2013


Field Notes: Cumberland Farms, a convenience-store chain in the Northeast and Florida, offers biometric support for its SmartPay service, which is available for iOS and Android devices. SmartPay gives users a 10-cent discount per gallon of gas when they use it to pay for fuel. The app requires consumers to enroll a checking account as the payment method. The app—developed in-house by Cumberland Farms—uses automated clearing house payment technology from Portland, Maine-based ZipLine Inc. The biometric log-in feature for the updated app works with any iOS or Android smart phone that has a fingerprint sensor, or facial recognition, as with the iPhone X. To pay for fuel, the user verifies the store location and pump number within the app to activate the pump. In addition to paying less for fuel at one of the more than 600 Cumberland Farms locations in eight states, the app enables users to pay for in-store purchases, find a store location, track rewards progress, and view savings from using the app.


DD Perks

Parent: Dunkin’ Brands Group Inc.

HQ: Canton, Mass.

Founded: 2012


Field Notes: Dunkin’ Brands recently excised “Donuts” from its famous moniker in a move to expand the appeal of its coffee and other beverages. Its DD Perks loyalty program, however, marches on, ending 2018 with 9.8 million members, up 20% from 2017. While Dunkin’s stores accept general-purpose mobile wallets that use near-field communication, a quick-response code-based payment feature remains a key ingredient of the DD Perks mobile app. Redesigned last year, the app facilitates easier in-app ordering and payments. Last month Dunkin’ enabled customers using general-purpose payment cards, cash, and the major mobile wallets at more than 1,000 stores to earn DD Perks points provided that before paying, they present Dunkin’s new plastic loyalty card or a QR code in the Dunkin’ app that has their DD Perks ID. Dunkin’ in April 2018 signed a multiyear license with its wallet provider to give it greater control over the technology running its mobile-ordering and payment platform.


ExxonMobil Speedpass+

Parent: ExxonMobil Corp.

HQ: Irving, Texas

Founded: 2016


Field Notes: ExxonMobil’s Speedpass+ app debuted as a smart-phone app that used mobile-payments services and credit and debit cards to make in-app payments for fuel at the pump. The app enables consumers to pay for fuel and other convenience-store products and services without dipping a card into a reader. It determines the consumer’s location either via the global positioning system or barcode on the pump scanned by the consumer. Once a transaction is initiated, the consumer can authorize payment with a stored credit or debit card, or Apple Pay, if using an iPhone, or Samsung Pay, if using an Android smart phone. The app is not only a way to avoid dipping a card, and perhaps exposing it to a card-skimming device, but as a way to drive additional sales with prompts for offers in stores or a car wash. Speedpass+ had been part of the Plenti multimerchant loyalty program managed by American Express Co. until that ran out of gas in July 2018. ExxonMobil Rewards+ launched in its place.


Facebook Messenger

Parent: Facebook Inc.

HQ: Menlo Park, Calif.

Founded: 2015


Field Notes: Facebook’s messaging app was one of the first to enable peer-to-peer payments in addition to conversations, and, with at least 1.3 billion users, it remains the largest and perhaps most useful such utility. It ran into headwinds last year, though, as a result of a scandal involving Facebook’s sharing of user data with an outside entity. And the global growth rate for messaging apps in general is slowing. But Messenger has one big ace in the hole: It was the first social network to embrace chatbots, many of which crawl the network to enable payments as well as other functions.


Google Pay

Parent: Alphabet Inc.

HQ: Mountain View, Calif.

Founded: Android Pay, 2015;

Google Wallet, 2011


Field Notes: After a series of rebrandings and service changes, the Google Pay as we know it today emerged last year as a one-stop shop for mobile point-of-sale and in-app merchant payments as well as person-to-person payments. Recent enhancements include a smoother process for moving from search to checkout, expansion to more countries, availability on Apple Inc.’s Safari browser as well as on desktops running the Chrome browser from chief Alphabet subsidiary Google, and the ability to hold transit passes. The eBay Inc. online marketplace, now in the process of completing its divorce from long-time preferred payments provider PayPal Holdings Inc., in March added Google Pay to its platform. EBay’s customers who have the Google Pay digital wallet also will be able to complete purchases on desktops regardless of operating system or device. It remains to be seen whether these enhancements will improve Google Pay’s market share versus general-purpose wallet rivals Samsung Pay and Apple Pay, all of which are still struggling for widespread consumer adoption.


Gulf Pay

Parent: Gulf Oil LP

HQ: Wellesley Hills, Mass.

Founded: 2016


Field Notes: Announced in early 2017, Gulf Pay is slowly rolling out in Gulf Oil’s market. In addition to paying for fuel at the pump with a smart phone, Gulf Pay users will be able to locate Gulf stations, view actual fuel prices, obtain directions, and view offers for fuel and in-store products. Details of how payment transactions will process were not released. The app will be available for iOS and Android devices, according to a Gulf Oil Web site. Gulf Oil has more than 1,800 Gulf gas stations. The app is built on technology from P97 Networks Inc., a Houston-based petroleum-services company. Other companies using its technology include To Go Stores, a Puerto Rico-based convenience-store chain, Phillips 66, and JPMorgan Chase & Co.’s Chase Pay.



Parent: Klarna Bank AB

HQ: Stockholm

Founded: 2005


Field Notes: Sweden’s Klar-

na, known for its single-click purchasing utility and its willingness to delay payment until a customer receives the goods she ordered online, may now have its work cut out for it. Its point-of-sale credit market, especially in the United States, just got more competitive with rival Affirm’s deal to make on-the-spot POS loans at Walmart stores. Still, privately held Klarna carries a lofty $2.5 billion valuation, and its U.S. merchant base keeps growing. It now stands at 100,000, up from 89,000 a year ago. Some 60 million consumers now use the product.


Kohl’s Pay

Parent: Kohl’s Corp

HQ: Menomonee Falls, Wis.

Founded: 2016


Field Notes: Kohl’s may operate a department-store chain, but its emphasis with its mobile app is speed at checkout, and not just for payment. The app also allows customers to redeem offers, rewards in the chain’s Yes2You program, and Kohl’s Cash in one barcode-based flash. “When we say fast savings at checkout, we mean really fast,” the company says on its Web site. The app’s developer is Omnyway Inc., a 5-year-old startup cofounded by Bill Melton, well-known in the payments industry as a founder of point-of-sale terminal vendor VeriFone.


Kroger Pay

Parent: The Kroger Co.

HQ: Cincinnati

Founded: 2019


Field Notes: Like other traditional mid-market supermarket chains, the 2,800-store Kroger empire is under attack from challengers ranging from low- and higher-priced brick-and-mortar grocers as well as new online competitors. With some retailers having success with proprietary mobile wallets, it’s no surprise that the newest arrow in Kroger’s quiver is Kroger Pay, a mobile app that debuted earlier this year in Columbus, Ohio, with expansion elsewhere planned soon. The app, available for iOS and Android devices, uses QR codes for payments as Kroger does not accept NFC-based general-purpose mobile wallets such as Apple Pay or Google Pay. Kroger Pay is part of a multifaceted loyalty program dubbed “Rewards” that includes a debit card, digital coupons, and personalized offers. Consumers accrue loyalty points when using Kroger Pay and can receive additional points when the payment method is the Rewards debit card or a general-purpose prepaid card that also carries a Kroger store brand.



Parent: Charlie Lee

HQ: Not applicable

Founded: 2011


Field Notes: Litecoin is a cryptocurrency that was specifically conceived as an alternative way to pay merchants. Charlie Lee, the former Google and Coinbase engineer who invented Litecoin, predicts 90% of online and brick-and-mortar merchants will be accepting cryptocurrency within 10 years, and Litecoin will be leading that charge. The reason, he says, is that transactions on the Litecoin network are faster and cheaper in comparison to Bitcoin. He has a strong case. The median transaction fee for Litecoin as of mid-April was 2 cents, compared to category leader Bitcoin’s 85 cents, according to Bitinfocharts.

Parent: MoneyGram International Inc.

HQ: Dallas

Founded: 2010


Pricing: $500 online transfer to Mexico—$4 if funded by checking account with cash pick-up; $6.99 if funded by Visa or Mastercard credit or debit card.

Field Notes: Western Union rival MoneyGram offers money transfers online in 24 countries and through its mobile app in 15. New countries on MoneyGram’s online platform include Australia, the Netherlands, Belgium, Portugal, and Austria. Online expansion is a key MoneyGram objective in the wake of China-based Ant Financial Services Group’s failed attempt to buy the company in early 2018. In addition to its 350,000 agents and online and mobile options, MoneyGram says it is expanding its services through kiosks, ATMs, and direct-to-bank services. Walmart remains MoneyGram’s biggest agent. In bill payments, MoneyGram in December said it would provide bill-pay services at more than 1,900 stores that are part of The Kroger Co.’s many grocery-store chains.



Parent: PayPal Holdings Inc.

HQ: San Jose, Calif.

Founded: 1998


Pricing: 2.9% plus 30 cents per U.S. merchant transaction; for PayPal Here, 2.7% for swiped transactions, 3.5% plus 15 cents for manually entered transactions.

Field Notes: If you just focus on the numbers, PayPal appears to be enjoying a golden age. Active accounts soared 17% last year to hit 267 million, and management’s expectation is that number will reach an even 300 million by the end of 2019. Quarterly revenue exceeded $4 billion for the first time in the final period of 2018 on the strength of double-digit increases in both dollar volume and transactions. Peer-to-peer volume, adding up both Venmo activity and PayPal P2P, reached $139 billion last year, cementing PayPal’s place in this hot market. Little wonder CEO Dan Schulman in January proclaimed the aspiration for PayPal to be the “de facto operating system for mobile and digital payments across the world.” But there are a few clouds in these sunny skies. Venmo is still losing money, and threatens to lose more as volume builds, dragging down PayPal’s take rate. Last year, just 29% of Venmo users performed a transaction PayPal could claim revenue on, mainly through in-store and online transactions. Meanwhile, former owner eBay Inc. is switching to Adyen for processing duty, demoting PayPal to just another payment method. While eBay launched its so-called managed-payments platform in September, it waited seven months to add PayPal, whose five-year operating agreement with the big online marketplace ends next year. PayPal continues to be acquisitive, snapping up iZettle AB, a sort of European Square, and U.S  payments provider Hyperwallet in 2018. And an agreement with bill-payment processor Paymentus promises to give PayPal entrée into an entirely new payments market.


People Pay

Parent: Fidelity National Information Services Inc. (FIS)

HQ: Jacksonville, Fla.

Founded: 2013


Field Notes: People Pay is FIS’s white-label person-to-person payment service. Financial institutions can apply their own brands and set pricing for the service. People Pay is built on the PayNet network FIS introduced in 2012 to offer real-time settlement for various non-card payments, and it also draws on FIS’s NYCE electronic funds transfer switch that links thousands of financial institutions, including ones that aren’t otherwise FIS clients. Users send payments through their bank’s online-banking system using the recipient’s email address or mobile-phone number. The recipient receives a text or email with instructions on how to retrieve the money. FIS also offers Zelle to financial institutions.


Phillips 66

Parent: Phillips 66

HQ: Houston

Founded: 2016


Field Notes: Refinery operator and fuel retailer Phillips 66 announced a mobile-commerce-focused platform in 2017 based on the P97 PetroZone m-commerce service Phillips an-nounced in 2016. In early 2019, Phillips 66 said paying for fuel at one of its stations will be integrated into a dashboard-commerce system under development with Honda Developer Studio. The new arrangement is expected to work at stations flagged under the Houston-based petroleum company’s three brands, which in the United States include 76 and Conoco as well as Phillips 66. Some 7,550 independently owned outlets in 48 states sell the company’s products. The company also said it will continue rolling out its My Phillips 66 mobile app, which launched last year and works in-store as well as at the pump with both Apple and Google devices. The app integrates Mastercard Inc.’s Masterpass wallet, which allows consumers to pay at the pump or in-store at Phillips 66 stations. It added Visa Checkout late in 2018 to the app.



Parent: Fiserv Inc.

HQ: Brookfield, Wis.

Founded: 2009


Field Notes: Fiserv acquired Popmoney in 2011, but now the person-to-person payments arena is changing, and Fiserv is changing with it. Zelle, a bank-owned P2P service, began national advertisements in January. Fiserv signed more than 100 clients for Zelle in 2018’s fourth quarter, a number that exceeded the total of the previous three periods. Fiserv has offered Zelle to financial institutions since 2016. All told, the company’s Zelle volume was up by a factor of six for the year, Jeffery Yabuki, Fiserv chief executive, said without citing specifics. “We continue to see strong demand around Zelle,” he added. Total P2P transactions, including Popmoney, grew 44% last year, he added.


Qwick Codes

Parent: MagTek Inc.

HQ: Seal Beach, Calif.

Founded: 2012


Pricing: $49.99 annual subscription

Field Notes: Qwick Codes rely on MagTek’s MagneSafe security architecture to generate one-time transaction codes consumers can use in place of actual payment cards in stores, online, and at ATMs. Users add cards to the Qwick Codes wallet by swiping them with a reader supplied by MagTek. The wallet can also keep transaction parameters such as dollar limits, where the code can be used, and an expiration date, and users can revoke the code at any time. To use the code at the point of sale, the user scans a barcode generated on his smart phone screen. At ATMs or online, he enters the 8-digit code.


Ria Money Transfer

Parent: Euronet Worldwide Inc.

HQ: Leawood, Kan.

Founded: 1987


Pricing: $500 U.S. to Mexico online transfer—$1 if funded with bank account, $4 with debit card, $10 with credit card.

Field Notes: Ria continues to be Walmart Inc.’s domestic in-store money-transfer provider, and it and Euronet’s other money-transfer brands handled 107.6 million transactions last year, up 17% from 92.2 million in 2017. The value of the transfers was $49.7 billion. Ria had 355,000 agents globally as of September 2018. In August, Xoom, PayPal Holdings Inc.’s online money-transfer service, announced a deal with Ria that will bring Xoom into a number of new countries, the largest of which is Russia. Under the arrangement, Xoom payment recipients are to pick up cash transfers from senders, most of whom are in the U.S., at 150,000 Ria locations.



Parent: Ripple Labs Inc.

HQ: San Francisco

Founded: 2012


Field Notes: Ripple, provider of the XRP digital currency, the RippleNet payment network, and blockchain-based technology, has been working to bring its services to financial institutions for use in various niches, including  cross-border payments that traditionally have been costly for businesses. Nearly 100 institutions joined RippleNet last year; the network now has more than 200 customers and operates in about 40 countries. Ripple’s xRapid cross-border service, which uses XRP and depends on exchanges to translate transactions into fiat currencies, recently earned a shout-out from The World Bank. In a March blog post, the bank noted that financial institutions participating in a 2018 test of the service in the U.S.-Mexico payment corridor saved 40% to 70% in foreign-exchange costs, with average payment times of just over two minutes. Last August Ripple announced three cryptocurrency exchanges would work with xRapid.


Samsung Pay

Parent: Samsung Electronics Co. Ltd.

HQ: Seoul, South Korea

Founded: 2015


Field Notes: Samsung Pay can connect to point-of-sale terminals via near-field communication. But, unlike Apple Pay and another NFC-based competitor, Google Pay, Samsung Pay also enables Samsung’s Android phones to link to the POS via a technology called magnetic secure transmission (MST), which means it works with just about any mag-stripe reader in the market. In 2018, Samsung said the service worked with approximately 2,000 financial institutions spread across 24 geographical markets. Samsung did not release a user count but said the service has processed 1.3 billion transactions since its launch. The company cites such features as Samsung Rewards and ATM transaction capability, both of which are available in the U.S. market, where Samsung Pay launched a few weeks after the August 2015 launch in South Korea.



Parent: Paysafe Group Ltd.

HQ: London

Founded: 2001


Field Notes: Originally focused on online-gaming transactions, Skrill, now part of the sprawling Paysafe empire, offers a variety of payment services for consumers and businesses, including money transfers to bank accounts and mobile wallets, and an online wallet. Last July, the Skrill Send Direct money-transfer service debuted in another nine countries, including India, bringing its total to 45. Skrill also enabled its wallet users to buy and sell cryptocurrencies, including Bitcoin, Bitcoin Cash, Ether and Litecoin, using any one of the 40-plus fiat currencies available in the wallet.


Starbucks Rewards

Parent: Starbucks Corp.

HQ: Seattle

Founded: 2011


Field Notes: The Starbucks Rewards loyalty program is built around a proprietary prepaid card and mobile app that facilities bar-code payments, supplemented by Visa prepaid and credit cards issued by JPMorgan Chase & Co. Starbucks Rewards claimed 16.3 million active U.S. members at the end of 2018, up 14% year-over-year. Reward members drive 40% of U.S. tender, and the mobile order-and-pay service represented 14% of transactions in fiscal 2018’s fourth quarter. In March, Starbucks announced program changes to enable customers to earn and redeem their “Stars” faster. Anything the loyalty program can do to spur revenues will be appreciated by Starbucks’ top brass as the heady days of growth in the U.S., which now has more than 17,000 stores, appear to be over. U.S. comparable-store transaction growth was flat year-over-year in fiscal 2019’s first quarter ended Dec. 30, 2018, though sales grew 4%.


Target Wallet

Parent: Target Corp.

HQ: Minneapolis

Founded: 2017


Field Notes: Target’s Wallet, created in late 2017, resides within the discount retailer’s mobile app and includes electronic coupons stored in the app’s Cartwheel section, formerly a separate app. Target early this year announced it would accept Apple Pay, Google Pay, and Samsung Pay, as well as contactless cards, but its preferred payment choice is its family of Redcards—a private-label credit card and Mastercard cobranded credit card issued by TD Bank, and a proprietary debit card. The Redcards can be loaded into the wallet and used for payments and coupon redemptions in one scan at Target stores. Redcards, which account for about 24% of Target sales, give the cardholder a 5% discount on Target purchases.



Parent: PayPal Holdings Inc.

HQ: San Jose, Calif.

Founded: 2009


Pricing: Free

Field Notes: Last year, we said PayPal’s peer-to-peer payment app Venmo just keeps sizzling, and in 2018 it did just that. It ended the year with $62 billion in volume, a 77% increase over 2017 as it worked to keep pace with Zelle, the increasingly popular P2P payments app from some of the nation’s biggest banks. Much of Venmo’s popularity stems from the fact that, unlike most P2P apps, it includes a social-media overlay, allowing users to converse with each other as well as send or receive funds. But there are some dark clouds over Venmo. One has to do with its price, which is exactly zero. That wasn’t much of a problem when its volume was smaller, but now all that free volume is helping to drag down PayPal’s take rate, or how much it earns on each transaction. The solution is Pay With Venmo, a service that lets users buy things in stores and restaurants. With that service in place, some 29% of users performed what PayPal calls a “monetizable” transaction in 2018. That percentage clearly needs to go up. PayPal’s CFO admitted in January Venmo was “not in the black yet.” Help could be on the way. In April, the Wall Street Journal reported that PayPal was seeking an issuer for a cobranded Venmo credit card. That would earn discount fees and help the bottom line.


Walmart Pay

Parent: Walmart Inc.

HQ: Bentonville, Ark.

Founded: 2015



Field Notes: The world’s largest retailer completed the rollout of Walmart Pay, its QR-code-based mobile-payment service, in 2016. Part of Walmart’s strategy with the service is to make it easy for consumers to use their Walmart-branded credit cards in the app. In 2018, Walmart made Walmart Pay an option for its order-online-in-store service. A shopper asks a store employee to order an item to ship to the store or the shopper’s home. A receipt is generated by the employee app. The shopper then takes the receipt to any store register to pay. Despite the massive size of Walmart and its customer base, Walmart Pay is not as well liked as Apple Pay is by these consumers. New York City-based Auriemma Consulting Group found that Walmart shoppers who use Apple Pay and have a mobile-payment preference are twice as likely to choose Apple Pay over Walmart Pay. Mobile apps from other retailers—Target Corp.’s Wallet and Kohl’s Corp.’s Kohl’s Pay—also are less likely to be chosen over Apple Pay.


WeChat Pay

Parent: Tencent Holdings Ltd.

HQ: Shenzhen, Guangdong, China

Founded: 2011


Field Notes: If you thought Alipay’s 700 million active users was hard to top, look no further than the other Chinese mobile wallet, WeChat Pay, which claims fully 900 million active users. Like its rival Alipay, WeChat Pay is starting to look abroad, particularly at the United States, to cater to users who are increasingly traveling beyond China’s borders. WeChat Pay is part of the Tencent empire, which integrates a number of popular digital services, including social media. And again like Alipay, it depends on quick-response codes rather than on near-field communication, the standard major U.S. wallets like Apple Pay and Google Pay have adopted. That makes WeChat Pay easy for merchants to install and appeals to China’s huge population of smart-phone aficianados. How well QR codes will work in markets converting to NFC, like the U.S., will remain to be seen.

Parent: The Western Union Co.

HQ: Denver

Founded: 2012


Pricing: $500 U.S. to Mexico online transfer—$5 if funded with bank account, $7 with debit card,

$9 with credit card.

Field Notes: Western Union, the leading wire-transfer provider, faces a host of challengers competing for the online transfer market, which is spurring the company to increase its coverage. is now available in more than 60 countries, with 20 new markets added last year. consumer-to-consumer revenues increased 21% in 2018 over the year before on a constant-currency basis, and transactions rose 25%. revenues represented 12% of $4.45 billion in total C2C revenues for the year. In March, Western Union said it would sell its Speedpay bill-payment subsidiary to ACI Worldwide Inc. for $750 million.


Yosemite X

Parent: Yosemite X Inc.

HQ: Palo Alto, Calif.

Founded: 2014


Field Notes: Thirty-five merchants in the Silicon Valley area are accepting the new Yosemite Card, which caps acceptance fees at 0.3%. The private credit card can do that because it uses blockchain technology to manage transactions. Typical discount rates for network-branded credit cards range from 2% to 3% or more. Yosemite X Inc. launched the card in 2019. Once approved for a Yosemite Card credit line—that decision is made internally at Yosemite and not reported to credit bureaus—users download the Yosemite Card app for an iOS or Android device. Consumers pay no fees for the account. Neither credit score nor credit history is a factor in the credit applications, the company says. To make a transaction, the cardholder presents the Yosemite Card via the mobile app. A dynamic quick-response code is generated that is linked to their blockchain account. The merchant scans the code to complete the payment. Receipts are sent to the cardholder’s mobile app. The card only works for face-to-face transactions, but Yosemite X expects to add e-commerce functionality eventually, along with a physical card. The card, which relies on the blockchain to track transactions, is expected to be available beyond the Silicon Valley area later this year.

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