Convenience store operator Sheetz Inc. and Wright Express, a provider of payment processing services to U.S. commercial and government vehicle fleets, launched a trial of a new ViVOtech Inc. mobile payment solution.
Vehicle drivers participating in the Sheetz Business Advantage fleet program will tap their near field communication- (NFC) enabled mobile phones on contactless payment readers at the pump.
The trial will span 350 Sheetz locations in Pennsylvania, Virginia, Maryland, West Virginia, Ohio and North Carolina. Drivers will download fleet cards over mobile networks into their NFC-enabled handsets.
Russ Lamer, Manager of Emerging Technologies at Wright Express, said, "The goal of this field test is to enable us to better understand NFC mobile payment technology and position Wright Express to rapidly achieve leadership in this exciting new market as it develops."
Sheetz convenience stores have been accepting contactless chip cards that use radio frequency identification (RFID) technology for payments at the pump and in-store for three years, making it a good candidate for the trial.
"The main reason Sheetz was selected to pilot this payment technology is because they are considered a leader in convenience store technology," Lamer said.
The idea behind the trial is to determine if the new technology will be:
Mobile payments have become almost commonplace in Japan and are taking hold in Europe, but acceptance in the United States has been slow.
"I think it's going to take some time in the U.S. simply because - and I say this from a near field communications perspective - it's going to take time for merchants to upgrade their point of sale systems to include the RFID readers," Lamer said and added that the upgrade can be expensive.
"I think one of the keys is we need to be ready for this as a company for the future because we believe here at Wright Express that that's where the technology is going to go because generations X and Y will be driving the demand," he said. When asked if he thought the fuel industry was a good fit for this technology, Lamer couldn't say, since it may not be.
"Any place you have the contactless card payments being made today, it's ideal for mobile technology," he said. "To me, it doesn't matter whether it's a merchant that sells fuel or a merchant that sells merchandise inside or a drug store that takes contactless. It's a purchase device. That's all it is."
Wright Express charge cards, issued by the company's wholly owned subsidiary Wright Express Financial Services Corp., are used to purchase fuel and maintenance services for approximately 4.5 million vehicles.
The company's portfolio features a MasterCard Worldwide-branded corporate card, TelaPoint, a provider of supply chain software solutions for petroleum distributors and retailers, and Pacific Pride, an independent fuel distributor franchisee network and international subsidiaries.
ViVOtech, a provider of NFC mobile payment software and contactless acceptance solutions, supplied the trial's mobile wallet, over-the-air fleet card provisioning infrastructure software, promotion management software and contactless terminals. ViVOtech has shipped over 450,000 NFC-enabled terminals to more than 33 countries worldwide. But most of the terminals have been installed in the United States.
Mohammad Khan, co-founder and President of ViVOtech, said a large number of level 1 merchants accept contactless payments, including Best Buy Co. Inc., Office Depot Inc. and Rite-Aid Corp.
He also said contactless technology is being employed in taxis in New York and Boston. ViVOtech did another major pilot with Bay Area Rapid Transit (BART) in the San Francisco Bay Area, partnering with Sprint Nextel for contactless mobile payments acceptance for BART passengers.
Khan noted that ViVOtech has conducted close to 30 mobile contactless payment pilots. He expects this payment method to enter the mainstream in the United States in 2011.
Khan said NFC-enabled phones can not only carry credit, debit and prepaid card accounts, but coupons and promotions can be downloaded onto them, too. "I call it loyalty 2.0 where you have a loyalty program which is more customized to you based on who you are," he said.
If fleet drivers at Sheetz lose phones, Khan and Lamer said users can "freeze" the accounts on e-wallets by making single phone calls. Users can then purchase replacement phones and click two buttons on them to download payment software for immediate use - a much faster solution than waiting for cards to be delivered in the mail.
Signs on gas pumps once warned against cell phone use while pumping gas. But studies proved phones don't generate sufficient static electricity to be dangerous around gasoline fumes, so signs were removed. Ironically, a few years later, mobile phones are now being used to pay for gas.
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