Apple Pay, Samsung Pay, Google Wallet—when top mobile platform industries are going after the same market, you know something is up. Wallet replacements are not new concepts but are a big deal. Paper money and copper coins should have been phased out long ago, but are still around because of “convenience.” Now, however, the Internet of Everything has redefined convenience making digital wallets more realistic than ever.
However, mobile payment means battery dependency, and with multiple app usage, talk time, and social media all draining a phone’s battery this could cause problems. After all, we know how fast many smartphones drain. At the end of the day, however, chargeless phones does not wipe away the need to pay at restaurants or grocery shops. What then?
Enter smart electronic cards, the better-than-a-fat-wallet backup.
Smart cards are connected to the cloud and internet, like everything else IoT device. The underlying idea is why use multiple visa and debit cards that make wallets fat and unmanageable when you can have an all-in-one alternative. One such example is the smart Stratos card, which offers consumers multiple payment options with one single (and very sleek) card.
The card has sensors and firmware, which technically defines it as a wearable, and communicate via Bluetooth, connecting it not only to point-of-sales (PoS), but also the card manufacturers so they know when these battery-dependent smart cards need an update or replacement. But money is a sensitive issue, which brings up the question of security.
In a recent interview, Stratos card CEO Thiago Olson talks about the solid infrastructure behind the wave-and-pay technology:
There’s a one time passcode on the card – it’s called tokenization and is similar to what Apple Pay uses – it brings a whole lot of security into the way you’re paying.
Basically, tokenization is replacing real data with encoded and meaningless ones so that even if the data is accessed without authorization, hackers wouldn’t be able to make sense out of what they get. So those wanting to keep their bank account information hush-hush can continue to do so with smart cards.
Aside from Stratos, there are also similar endeavors by other digital payment companies like Plastic and Coin, to name a couple. The market competition is there, however, since the smart card market is still at start-up size, there are glitches to be worked out between businesses and card holders, with the latter paying around $100 in subscription fees per year. But Mr. Olson’s vision for the future of Stratos cards—ease of use, convenience, and affordability—is one shared by all smart card companies:
We view ourselves as the iTunes for cards. You can digitize cards, store them on the cloud and download them when you need them. [...] Imagine walking into Macy’s or Nordstrom and receiving a digital card right there, instead of having to fill out paperwork and wait for one in the mail. [...] Banks can partner with us...and get a connected card out to their members. The benefit there, for consumers, is that banks can swallow the cost of the cards.
Will smart cards squeeze Apple Pay out of the market? Probably not. It’ll add diversity and color to the simple act of paying, if anything. With digital payment options, our wallets can finally go on a slimming diet.
Do you think physical money will ever expire? What’s your favorite form of electronic payment? We’d love to hear your opinions.