Innovations and Payment Systems

In-car payments: A wallet that’s truly mobile


Mobile wallets are coming to car dashboards. Is shopping while driving worth the risk?

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Soon your credit card will be able to go from 0 to 60 in about 6 seconds or less.

Mobile wallets are moving to dashboards as automakers partner with card networks and retailers to equip vehicles with in-car payment technology. Drivers will be able to pay for parking spaces and gasoline without even getting out of their cars. Meanwhile, tech firms such as Amazon and Google are bringing their popular voice assistants to cars, providing consumers a way to buy products while they’re behind the wheel.

In-car purchasing could be a bonanza for retailers and merchants, and a convenient shopping experience for consumers. Cardholders could also see new retailer discounts and opportunities to earn rewards and loyalty points as they shop inside their cars.

his is an exciting area of innovation – the opportunity of what role will the vehicle have within everyday commerce experiences,” said Rich Meszaros, connected commerce lead at Accenture Mobility.

However, some experts are concerned that the ability to shop while you drive could pose safety risks and encourage overspending.

Start your engines

The trend toward in-car payment systems started up last year and has accelerated in 2017. Last October, Mastercard announced a partnership with General Motors and IBM to bring mobile payments to OnStar systems in GM vehicle dashboards.

Visa and Honda in January demonstrated a new in-vehicle payments system they’ve been working on in collaboration with smart parking meter and gas pump manufacturers. Honda drivers will be alerted when they pull up to a beacon-equipped smart meter or fuel pump, and they can pay just by touching a button on the dash.

Ford Motor Co. recently proclaimed itself the first car manufacturer to add Amazon’s Alexa digital voice assistant to its vehicles. Ford said in a January press release the first phase of its Alexa integration would allow users to connect to their cars from inside their houses to their Amazon Echo, Echo Dot and Amazon Tap devices. You can start your car’s engine, check the fuel level, lock or unlock the doors and even gauge the battery life just by chatting with Alexa.

This summer, users will be able to talk to Alexa from inside their cars, enabling them to check the weather, edit their shopping lists and even buy stuff while driving. Drivers will be able to order any item available via Amazon Prime in their Alexa-equipped cars, and the voice assistant will make product recommendations based on order history.

John Scumniotales, general manager at Amazon Alexa Automotive, noted that users will also be able to order food from Amazon Restaurants and Pizza Hut and send flowers from 1-800-FLOWERS using Alexa’s “skills.” Skills are similar to chatbots in that they allow customers to interact with individual retailers, merchants, banks and other service providers via artificial intelligence. Of course, chatbots lack the personal touch of a human-sounding assistant like Alexa or Apple’s Siri, and they can’t be used while driving.

“We believe voice is the future,” Scumniotales said. “It will fundamentally improve the way people interact with their car.”

We believe voice is the future. It will fundamentally improve the way people interact with their car.

\u2014 John Scumniotales
General Manager, Amazon Alexa Automotive

Not to be outdone, Google is working with Hyundai to bring its Google Assistant to the South Korean automaker’s cars. Google’s voice assistant does not yet allow payments, but the tech firm is rumored to be developing that capability.

European car manufacturers are getting into the mobile payments game as well. Volkswagen in December acquired parking payment app PayByPhone and Luxembourg-based Daimler last month announced it bought digital payments processor PayCash Europe.

Smart driving
Paying for parking or fuel at your dashboard can save time, energy and discomfort. For example, a driver living in a cold climate can stay a little warmer by starting a fuel transaction in the warmth of his car’s interior instead of getting out and fumbling with his credit or debit card at the pump or meter.

Meszaros of Accenture said further advancements could enable drivers to pay tolls, buy on-demand insurance while inside a rental vehicle or order food while outside a restaurant that has no drive-through window. Meanwhile, interactions between cars and smart parking meters could help drivers better navigate high-traffic situations, such as sporting events.

“When you think about the bottlenecks in attending one of those events, it’s often parking,” Meszaros said. “What’s contributing to that bottleneck is paying for it. If your vehicle could seamlessly pay as you’re entering or exiting by communicating from the car directly to the parking lot, that would be a great experience for attendees.”

Paying for gas remotely can also help protect consumers from fraud and identity theft. Experts say credit card skimming at gas pumps is on the rise, and fuel stations were recently granted an extra three years to adopt security-enhancing EMV-enabled payments. In-car payment doesn’t solve all security issues related to gas pump transactions, but it’s a key step.

“We need to think about the entire life cycle of the security of that payment,” Meszaros said. “That’s everything from how do the payment credentials get into the vehicle to how they’re stored and how they’re transacted with the smart device outside the vehicle – whether they use tokenization or other techniques.”

Drivers could also save money on online purchases if in-car payments are integrated with reward and loyalty point programs. Mobile wallet providers, such as Samsung, are using their own rewards systems to encourage more consumers to pay with their phones. Rewards specific to in-vehicle payments have yet to materialize, but Meszaros said they are the “next likely step.”

Keep your eyes on the road – and your card balance
Adding a payment system or voice assistant to a car’s dashboard raises a safety concern that has loomed large in the smartphone era – distracted driving.

Researchers at the University of Utah found in an October 2015 study that drivers needed up to 27 seconds to regain full attention after issuing commands to voice assistants. A driver traveling at 25 miles per hour would cover the length of three football fields during that time, researchers said. The study’s subjects used Microsoft’s Cortana, Apple’s Siri and Google Now on smartphones and onboard infotainment systems offered by major automakers.

The potential risks extend beyond personal safety. Some experts think an in-car voice assistant that takes orders and encourages more spending could negatively affect consumers who are prone to shopping addiction. The impact of in-car voice assistants is not yet known, but the ease of online purchasing can encourage overspending.

Terrence Shulman, founder of the Shulman Center for Theft, Spending and Hoarding, said about 10 percent of Americans struggle with compulsive spending at some point in their lives.

“I’m not against anybody buying whatever he or she wants, but it’s no secret that people are getting more impulsive and impatient,” Shulman said. “There’s less time to consider a purchase because things are so easy.”

Cars and credit already require caution
In-car payments could revolutionize the way we travel and shop, but any exciting technological advancement has potential downsides. Shopping with credit cards and driving are two tasks that already require mindfulness and restraint. Consumers will win if dashboard payment systems don’t encourage us to let our guard down behind the wheel.

See related: No card, no problem: Pay with your ring, watch, bracelet, At festivals, wristbands are the new credit cards

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