Two out of three smartphone users in Denmark could soon have an easier way to pay from their mobile devices as Danske Bank, owners of Denmark's popular MobilePay app, announced a new partnership with UK-based retail technology company Powa Technologies.
PowaTag technology will be embedded into the MobilePay app, which is used regularly by more than three million Danish residents. It will accelerate the checkout process for mobile users in a variety of cases, such as from a "buy now" link in an email or at physical locations using beacon technology.
Available for everyone in Denmark aged 15 and above with a smartphone, a Danish mobile number, a Danish payment card and a Danish bank account, Mobile Pay is currently accepted by one-fifth of all retailers in the country.
But there is room for improvement, according to Powa Technologies founder and CEO Dan Wagner. “Although the MobilePay app has millions of regular users, it's not very effective at paying merchants because that wasn't the original purpose of the app,” he said.
“Integrating PowaTag’s singular ability to turn any form of media into an instant point of sale will further cement Danske Bank’s position at the forefront of mobile payments without compromising its decision not to charge customers.”
The one question mark over the partnership is how keen merchants will be to support the new technology. Powa Technologies has a few months to convince merchants ahead of the launch later in 2015, but the current momentum towards digital payments in Denmark points towards a positive outcome.
In May 2015, a pre-election economic package proposed by the Danish government included proposals whereby selected types of retailer will be permitted to turn away customers who can’t pay electronically.
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Head of Danske Bank's MobilePay division, Mark Wraa-Hansen, is confident the technology will be welcomed by users and merchants alike.
“Although we follow a development roadmap, it wasn’t written in stone that this would be the next step. We were impressed by the PowaTag technology and as we get a lot of feedback on MobilePay we saw a good match for the technology," he said.
“It's not going to happen overnight as we are starting from scratch. The technology will be available later in 2015 and we believe in the potential, and are confident it will catch on."
As for whether a cashless society is inevitable for Denmark, Wraa-Hansen remains on the fence. “If it happens it will be consumer-led. Consumers have the power to influence merchants who will in turn influence the banks,” he said.
“As the largest bank in Denmark, it is our role to support all payment types, so we don't have a preferred option. We invest heavily in MobilePay because we see the strong global trend towards mobile payments and we want to position ourselves well in this future payments landscape.
“Mobile payments offer a new kind of convenience and you can bundle together new services such as electronic receipting. That's a service that will have a lot of success with a large consumer base and it will be interesting to see if merchants will continue to support paper receipts alongside digital payments,” added Wraa-Hansen.