C&B Notes


Although Apple Pay is currently prevalent in the news, a collection of some of the biggest retailers previously joined together to build a new payment offering called ‘CurrentC’.  Used as an app on mobile devices, it is intended to let these retailers bypass the credit card processing fee (it would use ACH connected to bank accounts) and share the savings with consumers via special offers/coupons.  Apple Pay and CurrentC may fail because payments and security are difficult, but capitalism will continue to seek a way to squeeze a fat margin.

Long before Apple Pay, big brick-and-mortar retail chains were conspiring to sidestep the typical 2% to 3% fees they’re charged by credit card companies when consumers pay with credit.  A company called MCX (Merchant Customer Exchange), spearheaded by Walmart, was started to build a mobile payment solution that would become an app called CurrentC that’s preparing to launch, but is already in the app stores.

Rather than NFC, CurrentC uses QR codes displayed on a cashier’s screen and scanned by the consumer’s phone or vice versa to initiate and verify the transaction.  The system is also designed to automatically apply discounts, use loyalty programs, and charge purchases to a variety of payment methods without passing sensitive financial data to the merchant.

Retailers including CVS and Rite-Aid were planned partners for CurrentC.  Now those businesses have pulled unofficial support for Apple Pay through their existing NFC readers, according to a report from MacRumors and a memo obtained by SlashGear.  This implies they’ve established exclusive deals with MCX to use CurrentC as their mobile payment option.

A retailer-backed rival to Apple Inc.’s new payment system said hackers stole email addresses for some people participating in a pilot.  The consortium, called the Merchant Customer Exchange, said the intrusion by unauthorized third parties compromised the email addresses of some people who were testing out its payment system, called CurrentC, as well as some people who had expressed interest in it.  The breach didn’t affect the CurrentC app itself, and many of the email addresses were for dummy accounts, MCX spokeswoman Linda Walsh said.

Still, it comes at a sensitive time.  Retailers are already under scrutiny for a string of security lapses, and Apple has just launched its new Apple Pay system, which promises to be harder to hack than existing systems because it doesn’t share users’ account data.