Closed loop payments allow consumers to load money into a spending account that is linked to a payment device such as a gift card for a specific company (and only that company). Mobile closed loop payment applications are now enabling consumers to manage their gift card, or account, through their mobile device. Customers can now check their balance, top-up, and pay using mobile applications.
The benefits of a mobile application with closed loop mobile payments are realized immediately. In the retail and restaurant industries, companies such as Starbucks and Tim Hortons have processed millions of mobile transactions using closed loop mobile payments. Here are a few benefits:
Instantly begin to capture data on customer insights, buying habits, popular items as well as measuring the return on mobile marketing campaigns.
Keep customers coming back with the ability to send customized promotions and offers based on the data captured – right to their mobile devices.
The convenience a mobile phone coupled with the benefits of automatically topping-up balances, consolidating multiple gift cards, and pre-ordering to skip line-ups provides an immense competitive advantage in the industry.
So why now? Why 2015? Why today? Because all of the cards are in place.
The technology is now. Barcode scanning using mobile devices has already shown us that closed loop mobile payments are being used by customers. Ever since the release of Android 4.4 (Kit-Kat), NFC has come on board as another option for mobile payment.
The security is now. Closed loop mobile payments don’t tie into bank accounts or carrier networks. They’re less complex, secure and easy to use – not to mention they cost the company less (versus credit card transactions).
The market is now. Smartphones are being used by billions of people worldwide. Your customer may not have your loyalty card or your gift card, but more than likely, they have a smartphone. Customers are looking for ways to consolidate their mobile devices and their wallets. Closed loop mobile payments have found that solution for companies.
So why now? Because everyone is ready. The technology is ready, the security is ready, and so are your customers- are you?