With many mobile and prepaid digital wallets being launched in recent months, V.me by Visa is clearly defining its pathway through competitors as it has been officially launched in the UK. Gathering a large share of the pie among banks’ customers, Valentina Romeo explores how the fast and safe new payment service could be ruling the scenes
With UK bank Nationwide officially launching V.me at the end of November and RBS also confirming its commitment to the service, Visa Europe is just reaching its goal of internationally integrating the digital wallet outside the US market.
The strategic partnership with Nationwide is just the beginning of a UK-wide rollout of the service, with banks representing 80% of the country’s consumers already committed to the offering of V.me, Visa revealed.
Despite Nationwide being the first bank to launch the service in the UK, RBS has been the very first issuer in the country to test the service within its customers’ base and NatWest’s.
After Visa launched the service in May 2012, RBS adopted it as part of a trial in November the same year. However, Nationwide has beat it to become the first to fully apply the service, making it available to its 6.5m credit and debit card customers.
When starting the partnership with Visa early this year, Chris Rhodes, executive director of Group Retail at Nationwide revealed that the bank had seen an increasing number of members using their credit and debit cards when making purchases online.
Nationwide told EPI the main reason behind why they’ve launched V.me is to provide the banks’ members with a safe online experience.
Graham Beale, Nationwide’s CEO, recently said: "I’m excited that Nationwide is once again at the forefront of technological innovation by offering the V.me by Visa digital wallet, which will provide our members with a safe, secure and enhanced online shopping experience.
"In 1997, Nationwide were first to offer the UK consumer internet banking and we are always looking to invest in ways to improve the customer experience by pioneering new technology. In 2008 Nationwide took the decision to invest £1bn in the future of the organisation by implementing a large scale systems modernisation programme," he concluded.
More recently, the Society has rolled out a number of digital innovations, such as developing one of the highest ranked mobile banking apps and investing in future branch technology.
Contrarily, RBS has recently experienced a series of electronic payments faults, last example on busy Cyber Monday. This episode showed how the bank is still locked into rigid silos by its products and IT systems that were not designed to facilitate modern customer engagement.
V.me would then represent a vital move from RBS to enhance competition, customer service and keep up with a distinct digital strategy.
"We’ve been trialling to make sure we offer the best proposition to customers. We’re rolling out V.me officially to a wider group of staff from December 2013 and will gradually launch to customers next year," an RBS spokesperson said.
When announcing the partnership with Visa, Steve Rubenstein, director of everyday banking at RBS also said: "We believe that a proposition which reduces the effort of buying things online, while also improving security, for our customers is exactly the sort of thing we want to deliver. V.me clearly delivers this and we look forward to offering it to our customers."
A road towards expansion
V.me was launched in the US in the fall 2012 seeking to increase adoption of the company’s digital wallet service by partnering with large issuers and retail banks.
In November 2012, Visa was adding V.me service to the Visa cardholders of more than 50 additional financial institutions.
"V.me is built around a single concept, to help people shop online simply and securely," said Jennifer Schulz, global head of e-commerce for Visa. "We understand that need and believe our long-standing relationships with financial institutions, merchants and acquirers put Visa in a strong position to deliver the very best digital wallet experience."
US Bank began offering V.me in October 2012 and Bank of America started piloting the digital wallet at the end of November the same year.
Despite the fast and engaging service V.me offers, awareness of digital wallets in the US is still low- excluding PayPal services.
According to a new report from digital measurement firm comScore, only 12% of US consumers report having used digital wallets.
Potentially, the report said, half of all consumers will use them in the future.
According to Visa Europe, V.me is now active in the UK, France, Spain and Poland. Nationwide Building Society and RBS are joined by leading issuers BPCE and LCL in France, with ING Bank Slaski now in pilot in Poland and multiple pilots also underway in Spain.
Visa said by January 2014, up to 4,000 merchants will accept V.me thanks to other strategic partnerships with main services suppliers in the payment industry, notably WorldPay in the UK, as well as Be2bill (Rentabiliweb), Payzen (Lyra Network), Payline byMonext, Paybox (Point VeriFone), SystemPay (Natixis Paiements) and Worldline (Atos subsidiary in e-payment services) in France.
Furthermore, a V.me by Visa pilot programme rolling up for Ireland will take place in early 2014, with more launches soon to be announced, the company confirmed.
Visa Europe said it ambitiously expects a third of European consumers to be using its digital wallet service by2020.