Mobile payments have been slow to catch on in Canada, but that could change with a big expansion announced by mobile wallet app Suretap.
Bell, Telus, Koodo and Virgin are backing Suretap, which was launched by Rogers in 2013 and spun off as a separate company late last year. Suretap is now co-owned by Rogers, Bell and Telus.
“Unless you have a ubiquitous market, you’re going to have difficulty in terms of on-boarding retailers and so forth,” said Jeppe Dorff, president of Suretap. “Imagine if every single retailer had to integrate into three different carriers or five different handset manufacturers in order to get full reach. It’s just not what they do.”
Previously, Suretap only allowed payments by Rogers customers using a prepaid MasterCard or gift cards from select national retailers. Now, 30 retailers — including Indigo, Cineplex, Swiss Chalet and Harvey’s — have signed up with Suretap. CIBC has also come on board as Suretap’s first major bank partner. Customers can add any CIBC Visa or MasterCard on eligible Android or BlackBerry smartphones.
Suretap’s broader partnership reach “opens up opportunities for marketers to engage with the wallet itself,” said Dorff. Beyond just a payments solution, he explained, Suretap is “a marketing platform that helps creates experiences for consumers.”
The Suretap wallet lets users store credit cards and gift cards in on place. They can make payments by holding their NFC-enabled smartphone up against payment terminals and use QR/barcodes to redeem gift cards. In the future, the Suretap wallet will also store loyalty cards, debit cards and digital coupons. Users will also be able to receive relevant offers and search for customized deals.
Suretap believes the Canadian market is ready for its mobile wallet, noting that contactless payment terminals are available in 75% of major retailers and that smartphone penetration is 73%. But so far, Canadians haven’t been keen to pay for purchases with their smartphones. A global survey conducted by GfK last fall found that only about 2% of transactions in Canada are made with a mobile device. About 21% of the 1,000 Canadians polled said they had made a mobile payment in the past six months.
Dorff acknowledges that the uptake has been slow. “But that is part and parcel in terms of the approach that has been taken in Canada,” he said. “If you, as a consumer, are interested in having a payment card on your phone, say from [a big bank], you can download their app and put your Visa or Mastercard on that phone and go make payments. But ultimately payments is not enough—it’s just table stakes.”
Consumers will adopt the mobile wallet, he continued, “when marketers take advantage of the wallet as a platform, not as a closed environment, but rather [a channel] where they can engage with their consumers… When marketers start realizing that that is the path forward and that’s what is going to drive adoption, I think you’re going to see a spike.”
Suretap’s announcement comes as Apple Pay reportedly plans to launch in Canada this fall. The mobile payment and digital wallet service lets users make payments using the iPhone 6, Apple Watch and select iPad devices. In the U.S., Apple Pay has partnered with a slew of major retailers including Macy’s, McDonald’s, Subway and Whole Foods.
But Dorff said he doesn’t look at it as “us versus them.”
“It’s really a matter of saying we address different markets,” he said. “Not only do we address something outside of Apple — which is Android, Blackberry and soon to be Microsoft devices — but we also cater to the hyper-local market… We’ve launched with some of the biggest brands, but we also care about the small brands because consumers in Canada care about small brands.”
