Someday, a driven entrepreneur will devise the perfect mobile payment technology. You won't need to charge it up, and it won't require a companion app. You'll be able to use it to purchase things from a chain store, independent boutique, vending machine, or food truck. You might even be able to fold it so that it fits into any pocket.
Until that fantastical day, we've got smartphone apps and accompanying devices that work at one retail chain or a bunch — but nothing yet that's universal.
Apple launched Apple Pay with characteristic fanfare in October, Google has been promoting its Wallet since 2011, and Coin, a credit-card-like device that can "act like" any of your cards, will be available next year. It obviates the need to carry a collection of cards with you, but the $100 device will purportedly work in only 85 percent of all credit card terminals. And once its internal battery runs out, you'll need to buy a new Coin.
I've been testing some of the locally developed products and services and talking to the people behind them. One of Coin's rivals is the LoopPay CardCase, made by a Burlington startup. It costs $50 and is available for several iPhone models. If you feel like paying for stuff with cash or a card is too predictable, this might be just the holiday gift for you.
First, you download LoopPay's app, create a password, plug a LoopPay accessory into your phone's headphone jack, and swipe in some of your credit cards, debit cards, or even store gift cards. (Some take a few tries to successfully swipe.) Then, you put your phone in a specially designed case that has a slide-out "virtual credit card" on the back. Then, you charge up the virtual credit card with its own charging cable. Then you link the card with your smartphone via a Bluetooth connection. (Also takes a few tries.) Then you are ready to go on a spree!
The LoopPay app lets you pick from the list of cards you've loaded onto it, and then relays that card data to the virtual credit card, so that when you slide it out, it can be your Barnes & Noble gift card or your work AmEx. You hold the card near any magnetic stripe reader, press a button on the back, and hope. My success rate so far is 53 percent. It purchased some gifts at a Michaels craft store in Cambridge and a tea at one Panera Bread, but it didn't work at a different Panera, a taco shop, or a Peet's Coffee. Often, a clerk would apologize for an "old" register system, and I would default to using paper money (first used in the 11th century in China) or a credit card (which dates back to the 1920s.)
I've long used an app from Boston-based LevelUp for payments at cafés, pizzerias, and food trucks. It lets a clerk scan a special code on your phone's screen to charge a credit card, but what's better is that it keeps track of how much you've spent with a merchant. Often, there are rewards once you hit a certain spending threshold, or special offers to get you in the door the first time. But while LevelUp is quite reliable, most of its merchants are lower-end dining establishments.
The recently launched Apple Pay technology is similar — just tap your phone at a terminal to pay — but it doesn't keep track of your spending for a store rewards program, and it is mainly accepted at big chains like Panera, Toys R Us, and Macy's. It also requires that you have the latest iPhone 6. Blaine Hurst, executive vice president of technology at Needham-based Panera, says that the initial usage numbers are strongest on the West Coast and other "tech-savvy areas." "It will take time to grow," Hurst says.
A mobile payment system that hopes to give Apple a run for its money is being built in Needham by Merchant Customer Exchange, or MCX. MCX is a coalition of a couple dozen companies you might have heard of, including Target, Walmart, 7-Eleven, Dunkin' Donuts, and CVS. The system, called CurrentC, is being tested quietly by employees of several of the companies, and the public launch will take place "probably in the first half" of 2015, chief operating officer Scott Rankin said. All of MCX's participants have agreed not to deploy Apple Pay until a few months after MCX launches — and some, like Rite Aid, drew unwanted publicity when they first turned on Apple Pay in October, only to shut it off a few days later.
Rankin says that paying for stuff is "arguably the least-broken part of the system today. Consumers don't care about tapping your phone versus swiping a credit card." So CurrentC will allow customers not only to pay with their phones but to receive digital receipts, coupons, and loyalty credit through the app. It won't require any accessories, and apps will be available for both iPhone and Android, Rankin says. MCX has been developing CurrentC in collaboration with a Newton startup called Paydiant.
One key aspect of CurrentC, says Robert McCarthy, a technical adviser at the mobile software development firm Mobi-quity, is that it will help retailers reduce credit card fees by debiting money directly from users' bank accounts. But it remains to be seen whether CurrentC will be simple to set up and use. McCarthy says CurrentC might be targeting "a different, broader customer base than people who can afford new iPhone 6s" and says the big retailers behind MCX will no doubt give it a promotional push next year. But McCarthy says, "I'm really disappointed that they weren't able to roll it out for the Christmas season."
Earlier this month, after I'd blogged about my hit-or-miss experience using LoopPay, a senior executive at the company asked if he could join me as we revisited a few of the places where I had problems. It felt a little like Martha Stewart showing up in your kitchen asking you to re-make your Christmas ham under her supervision.
Using his device, we were able to buy some nacho chips at a taco shop where mine hadn't worked. But I'm not sure I'll ever forget the scene at FroyoWorld in Allston, when the executive, Damien Balsan, tried three different LoopPay devices to purchase a cup of frozen yogurt. When none worked, and as the yogurt sat on a scale getting soft, Balsan asked the shop's co-owner if he could step behind the counter and try a few times from the cashier's side of the register. Still no luck.
Eventually, the mobile phone will be a great way to pay. But my impulse at that moment: to take out a five-spot — not a shabby invention in its own right — and buy the yogurt.