With Its McDonald’s Deal, Softcard Gains More Access to Everyday Spend for its NFC Wallet

While Apple Inc.’s Apple Pay mobile wallet has been grabbing the headlines, the telco-controlled Softcard mobile-payments service this week lined up another major fast-food chain. Consumers now can use their Softcard mobile wallets to pay for purchases at U.S. McDonald’s locations. Formerly known as Isis, Softcard is a smart phone-based scheme that enables consumers to tap and pay using a stored payment card in a mobile app.

Most of the 14,000 McDonald’s USA LLC restaurants are able to accept contactless payments, including those made with apps using near-field communication (NFC)-equipped smart phones, such as Softcard. NFC is a two-way communication protocol that enables devices to share data wirelessly with each other. Participation, however, may vary, Softcard says.

Softcard says consumers are able to use their NFC smart phones in the drive-thru, too. “Once parked at the drive-thru window, customers will use their phones and tap to a contactless reader extended by a McDonald’s crew member,” a Softcard spokeswoman says.

With scores of mobile wallets available to consumers, and potent mobile-payments competitors like Apple Pay and Google Inc.’s Google Wallet in the market, Softcard hopes to distinguish itself by combining payments, loyalty, and offers into its app. McDonald’s, however, “is focused on the mobile-payment capability to provide more ease and pay options for its customers,” the Softcard spokeswoman says.

The McDonald’s tie-in with Softcard is important for several reasons. For one thing, it offers another potentially huge source of everyday spend. Experts say stores where consumers shop or eat everyday can help make new payments methods habitual, and all the more so if the retailer boasts thousands of locations nationwide. Softcard’s McDonald’s coup follows its agreement with rival fast-food chain Subway, which began accepting the mobile wallet Oct. 1 at more than 26,000 U.S. locations.

Such deployments could become even more common in the coming months with the arrival of new point-of-sale equipment at merchant outlets, says Beth Robertson, principal at Robertson Payment Services LLC, an advisory firm. “The required card industry evolution to EMV is leading the merchant market to adopt readers that will be compatible with mobile NFC solutions,” Robertson tells Digital Transactions News in an email. The U.S. payment card industry is converting to the Europay-MasterCard-Visa (EMV) chip card standard as a fraud prevention measure, which is causing many merchants to update their terminals, often with NFC capabilities, too.

Softcard helps broaden the use of NFC payments, she says. “But the Apple Pay solution is limited by its current strict affiliation with iPhone devices. Softcard extends acceptance to Android devices and, as a result, reinforces the value of NFC. At the same time, it will build consumer access to mobile payment at the POS, helping to reinforce the use of mobile devices for payment.”

Softcard is a joint venture of three major mobile carriers, AT&T Wireless, Verizon, and T-Mobile USA.