Mahesh Sharma July 18, 2012
Albert, CommBank's new merchant terminal.
The Commonwealth Bank has stepped up its fight for attention, launching yet another technology-led product, this time with an Android-powered retailer device it will call Albert.
The bank is betting on changing the way customers pay for goods and services, in the process by-passing eftpos machines and upping the ante on contactless payments. It has also developed a new merchant-focused app store - somewhere for Albert to go shopping.
In a tangent from its consumer-focused innovation efforts to date which include the Kaching iPhone and now Android app, the upcoming Facebook social banking push; and Bump which allows people to pay each other by "bumping" phones; the bank is now targetting the merchants and retailers to close the loop on the payment process.
The "Albert" retail point-of-sale device will be launched in the second quarter of next year and will allow shoppers to make credit/debit card payments via swipe, near-field-communications (NFC) chip, and PIN transaction. It combines the functionality of eftpos terminals with the features of smartphones. Merchant apps will be developed on the "Pi" software development framework and hosted in a CommBank app store. The technology was developed jointly by CommBank, German payments device manufacturer Wincor-Nixdorf and Californian design firm Ideo.
It follows a launch last week by Westpac, also aimed at retailers. The iPhone app 'Westpac Mobile PayWay' allows small business merchants to process MasterCard and Visa card payments in real time. The launch coincided with the release of new research from Westpac, which showed one in five Australians want more banking applications on their smartphones.
CommBank is pushing its security credentials, with executive general manager of corporate banking solutions Kelly Bayer Rosmarin saying all apps and developers must be pre-approved by the bank. She said the bank developed the world's first touch-screen, encrypted, EMV PIN pad, so customers can securely enter their PIN on the Albert device, not on other smartphones and mobile devices.
"Every app will go through a vetting process," Bayer Rosmarin said. "It's not like a consumer device, we have to know the company building the application is a legitimate business entity with a legitimate business purpose. We'll make sure they're not doing anything untoward that could compromise the security."
She did not reveal how much it would charge retailers for the new device, but admitted that not every retailer will want one.
"We purchase a huge number of terminals and buy thousands and thousands of terminals every year," she said. The bank would consult with merchants over the next few months. "We'll work with customers on a bespoke basis, to see who's going to get it at what point, but they need to be ready to roll it out."
There are ten apps available now, but she didn't know how many there would be at launch. She hoped third-party developers would take to the device.
Developers prefer to create applications that will reach bigger audiences, such as the iPhone and Android platforms, and there are question marks over whether they would devote resources to a platform that will only reach the market next year, and have a potential audience of a few thousand users.
The involvement of developers will be a decisive factor in the success of the device, according to Telsyte analyst Rodney Gedda, and whether they can create useful applications that leverage the device's position as a conduit between customers, merchants and the bank. However, it could also just replace the traditional "dumb" point-of-sale terminals.
"It could be used in a dumb fashion, the way that you use a smartphone as a phone, but to get the biggest benefit, you want to use the apps.
"You can split the bills, donate to charity, integrate with other finance systems but the real benefit for merchants is to take the advantage of the apps. They don't have to, they can use it as a stand-alone device."
CommBank also announced "Leo", a case that functions as a cradle, by terminal maker Ingenico, that can be attached to merchants' iPhone 4, 4s and iPod Touch devices to turn them into mobile payment terminals.