Cloud-based mobile payments are transforming your devices into e-wallets

Cloud-based mobile payments are transforming your devices into e-wallets

Cloud-based mobile payment is gaining momentum across the world. Technological innovations are now offering customers the full suite of capabilities as devices are being ingeniously transformed into digital wallets. And the level of technological convenience is escalating at an amazing pace.

Cloud-based mobile payments explained

Cloud-based mobile payment is offering new levels of convenience. By simplifying payment processes- for example, a payment made with a simple tap at Point of Sale (POS) terminals- cloud-based mobile payment is changing the payment landscape for issuers, merchants, and consumers alike.

Cloud-based mobile payment places the mobile payment provider in the middle of the transaction that is itself broken into two separate steps. Google, PayPal, GlobalPay, and GoPago are examples of providers having adopted this system. This type of payments offers further arrays of benefits such as:

  • Flexible business models
  • Secure environments and advanced tokenization
  • Issuer brand value
  • Less dependency thanks to fewer intermediaries
  • Endorsement by major associations like Visa and MasterCard

To date, mobile payments have largely been dependent on the Secure Element (SE) to store credentials on mobile phones. Google has come up with NFC Host Card Emulation (HCE) support for Android that performs the same task as SE. As such, issuers can be independent of SE and can use cloud-based digital cards to make EuroPay, MasterCard, and Visa (EMV) – compliant payments at POS. The levels of security of cloud-based mobile payments have, hence, been jolted upwards.

How do mobile wallets work?

For many people, their phones are their wallets. Equally called as electronic wallets, virtual wallets, and digital wallets, mobile wallets enable financial transactions. Today, with a simple tap, the amount is deducted from the mobile wallet account of the customer into the merchant’s wallet account.

Several mobile apps are available today whether you want to split a bill, send a money gift or refund someone, for example. They are available at Point of Sales where customers can pay by a simple tap on the phone. Starbucks is a good example of a closed loop mobile payment which is specific to a company. Other examples in the same line are Walmart, Taco Bell, Subway, and Sonic. Mobile payment is equally used for direct carrier billing, for example, when you buy an app or ringtone for your mobile or when making donations to the Red Cross, for instance.

There are various banks and non-banks apps. Examples of bank apps are Bank of America, Simple, Wells, Fargo and Chase, while PayPal, Google Wallet, Square Cash, Blockchain are non-bank mobile apps.

Cloud-based mobile payment is secure

One of the greatest benefits that cloud-based payments offer is that consumers do not have to ensure the security of their own payment information. There is no Single Point of Failure (SPOF) in a cloud environment because devices and network paths are duplicated and reserved.

Cloud-based mobile payment facilitating parking issues and services

One of the most innovative and compelling revolutions that cloud-based mobile payment has brought forward is payment for parking. In San Francisco, for example, this system is handled by PayByPhone allowing users to refill their parking meter through a comprehensive mobile app that also keeps track of time remaining and informs the user when a meter is going to expire. In Canada, the streets of Toronto have equally embraced mobile payment for parking with the Green P Mobile App through PayPal. Customers also have the option to extend their parking sessions remotely, improving customer experience.

Cloud-based mobile payment facilitating car fueling

Service providers like Shell have rushed to embrace cloud-based mobile payment. The Shell App allows customers to “fill up and go”. This mobile payment service has been designed to offer speedy and secure payment through Apple Pay, Android Pay and PayPal for customers to pay for their fuel.  Other providers have followed the step.

Mobile payment even improved water service in East Africa

A study by Oxford University that mobile payments have been improving water service provision in East Africa by reducing corruption. This mode of payment has removed opportunities for theft, collusion, and bribery.


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