Every day is a school day when it comes to the ever-evolving mobile payment technology – and New Zealand is the teacher.
In 2006, London was gripped by paranoia and fear. People ran in the aisles of supermarkets, panic-buying peas with handfuls of cash. This wasn’t the apocalypse, merely the introduction of chip and PIN – overturning the previous method of merely signing for all card payments. Expats living in Britain rolled their eyes as the locals tried to grasp a system not unlike PIN-enabled EFTPOS transactions that Australia and New Zealand had already been using for 20 years.
Kiwis are known to be early adopters of new technology and their hunger to try groundbreaking gadgets has made the nation a testing ground for many international companies. From Facebook software updates to Google’s balloon-powered Wi-Fi network, its relatively small, geographically isolated and connection-hungry market laps up everything cutting edge – and gives great feedback unlikely to leak to the rest of the world.
So in 2013 when it was announced that an unlikely cohort of companies, three of which are usually competitors, had united to create a mobile wallet for the New Zealand market called Semble, there were palpable ripples of excitement. Recent statistics from MasterCard customer survey show only one in five Kiwis carry cash, 77 per cent own a smartphone and 69 per cent use mobile banking, according to Semble’s recent report The State of Pay, New Zealand was the logical testing ground for the Semble “tap and go” app.
Semble, which became available to Android users in March after two years of extensive trials, is not only a payment method. It was designed to be a one-stop shop: to store information about loyalty cards, personal identification, travel tickets and more. The problem is that it requires partners to buy into that philosophy.
While the three main mobile phone networks and the payment infrastructure organisation Paymark run Semble, the app is partnered with only two of the four main New Zealand banks. While contactless use has grown in the past year (from 4 million transactions in August 2014 to 8.5 million a year later), there are a number of other barriers to the uptake of Semble.
Statistics from Google Play suggest as many as 25,000 Kiwis have downloaded the Semble app to their Android phone but even the Semble chief executive Rob Ellis admits that offering contactless payment from a mobile phone alone is not enough. “What will drive growth are other services beyond payments – public transport, loyalty and offers in particular,” he said in an interview with www.stuff.co.nz in November.
With the PIN-free limit set at only $80 and the cost to the merchant as high as 3.5 per cent depending on your bank, the availability and versatility of contactless transactions is still quite limited. Many also see it as a bit of a novelty in a country where eftpos is free and readily available at the swipe of a card.
There are, of course, other tap and go services available, such as Westpac’s PayTag. A sticker on the user’s phone makes host card emulation (HCE) technology accessible. Customer information is stored in the cloud ready to transmit via a preferred device. Not only does it not rely on mobile networks, it requires less of a leap of faith to use it. “Customers want their digital wallet from their main financial institution [rather than a third-party product],” said Westpac’s chief product officer Shane Howell in an interview in July 2014. 
The ASB bank has a similar app despite being a payment partner for Semble, and ANZ launched Its goMoney mobile wallet in December 2015. These bank-owned apps aren’t as diverse in their application potential as Semble, but they do offer a service that is easy to set up, more cost effective for merchants and is perceived by many consumers as more secure because you are dealing direct with your bank.
Overseas, we’re seeing a revolution in mobile wallet apps. Apple Pay, Softcard and Android Pay have been released in the US and beyond. This means Semble has no direct rival on Kiwi shores, but it is far from a one-horse race. The challenge presented by other tap and go products, and the passionate relationship Kiwis have with their eftpos card means it’s essential for Semble to continue to grow and diversify its portfolio.
 This article represents the views and opinions of the author and do not necessarily reflect the opinions of BPAY.
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