I blogged about contactless on numerous occasions, expecting Moscow authorities to unify different transit schemes under one banner, given that the standard used is all the same (MIFARE). Disparate contactless domains make it less interesting to launch a large-scale card product – so most are talking about pilots, rather than commercial launches. It may be understandable that providers want to make sure the business model lives in closed-loop environments until you start opening up the standard, or giving others permission to use it.
The problem is, that success in new payments schemes lies in large scale implementations – and that is possible to organize with contactless technology getting cheaper by the day. It may even be worth it to issue payroll cards by default: the potential of contactless in Russia is not additional payments revenue streams, it is core products that you implement with it.
I. e, contactless for payroll can stimulate customers not to withdraw cash from the card – acting like a defense mechanism against ATM cash management costs, overnight income from current accounts and other perks like loyalty from marginalized customer segments. I also love card products for students – and happy to notice Moscow Credit Bank MasterCard PayPass branded campus card for a major university in Moscow [in Russian] – where the card offers access, ID, vending machines and general payments services. With the right channel mix, the venture can add to the understanding on how to roll-out new technology.
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