RBC CEO Dave McKay told RBC investors and clients at a conference today in New York the financial institution is set to take on mobile payment competitors such as Apple and Google, warning a “collision course” is under way, reports the Financial Post.
Apple Pay, the smartphone giant’s mobile payment platform, is taking off in the United States, but such systems threaten to get in between banks and their customers, Mr. McKay told RBC investors and clients at a conference in New York on Tuesday.
Though RBC would still be paid for transactions if it were to embrace the platform, the bank would lose an important connection to the paying customer that exists with other payment methods such as credit cards.
McKay said “So we’re on a collision course,” noting how taking on Apple and Google is not something RBC would do unless it was absolutely necessary. The bank wants to be on top of the mobile payment ecosystem, instead of technology companies, touting “trust and security are key assets. They buy us time,” McKay explained.
RBC’s SecureCloud is the bank’s own mobile payment solution based in the cloud that relies on tokenization, and hopes it will help the company become a global player in processing mobile payments.
What makes Apple Pay unique is Apple doesn’t see what customers are buying, where they are buying items or the amount. This data is typically available to credit card processors and is valuable to track customer trends and spending habits.
According to Apple executive Eddy Cue, here’s how Apple Pay keeps customer purchases private:
“Apple doesn’t collect your purchase history, so we don’t know what you bought, where you bought it or how much you paid for it. And if your iPhone is lost or stolen, you can use Find My iPhone to quickly suspend payments from that device.”
RBC said earlier in January Apple Pay was “major interest to the industry.” Back in February, it was rumoured RBC Bank in the U.S. was seeking Canadian testers for Apple Pay.
Apple reportedly inked deals with major banks in the U.S. for lower credit card transactions fees for Apple Pay. The mobile payment is rumoured to launch this month in Canada, but we did not hear anything at Apple’s special event yesterday.
Right now, the race is on in Canada to see which bank or financial institution will be the first to support Apple Pay. Canada’s merchants already have a vast network of NFC-enabled and Apple Pay-ready point-of-sale terminals, which we previously showed you in demos.