Aksarben Village shoppers soon will be able to pay for a smoothie, a cupcake or groceries with something other than the usual cash, check or charge.
Several retailers in the shopping center at 67th and Center Streets are starting to test and use a new “mobile wallet” payment system developed just a few blocks away at the Scott Technology Center on the University of Nebraska at Omaha's Pacific Street campus.
The system lets customers pay using a bar code on their mobile phones, and will let the businesses push coupons and other offers to users who are shopping, dining or catching a movie at the center.
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MoneyClip Mobile's developers, including graduates of the Peter Kiewit Institute, also on the UNO campus, aim to compete with better-known mobile wallet products like Google Wallet, Square — used at Starbucks — and Dwolla, developed in Des Moines. Those competitors have a head start, but MoneyClip's developers believe there is room for other players and time to compete for users.
Mobile payments have not taken off as quickly as some in the industry expected them to a few years ago. Technology research firm Gartner this year lowered its 2017 forecasts for global mobile payment transactions because of lower-than-expected growth in 2012. The firm said mobile payment transactions will reach $721 billion by 2017 and that payment system developers have yet to “optimize” the buying experience.
Consumer studies from payment processing firm First Data show that consumers are concerned about the security of mobile wallet programs, even as developers say the products are as secure or more so than credit cards. If consumers are going to change their habits and start using a mobile wallet, they also are demanding more than just a financial transaction — they want personalized service, including loyalty rewards and deals tailored to their individual needs, according to the firm, which has operations in Omaha.
Payments systems provider ACI Worldwide, which also has operations in Omaha, surveyed payments professionals at a June conference and determined that obstacles include concern about fraud, a lack of integration with existing payments system software and a lack of consumer interest. Just one in 10 of those surveyed said mobile wallets will become widely adopted in the next two years. The Federal Reserve Bank of Boston has also studied the emergence of mobile payments and in May described the market as still nascent and fragmented, but with progress toward improved security, privacy, value-added services and revenue opportunities.
That there is so much room to grow and so many competitors trying to gain a foothold is both scary and exciting, MoneyClip founder Josh Cross said. He sees the competition as validation of the opportunities ahead.
MoneyClip was developed over the past three years, funded in part with grants from the National Science Foundation and the Nebraska Department of Economic Development. Cross and board member Ken Moreano, executive director of the Scott Technology Center, hope they can demonstrate success in Omaha, seek venture capital funding and expand. The company also employs technology developers Aaron Sharp and Scott Kenealy, and Anna Bley, who handles business development and customer support.
To test the product, Cross and Moreano approached Lisa Bockman, marketing coordinator for Noddle Cos., Aksarben Village's property manager.
Bockman said she thought it would appeal to people who come to Aksarben on their bikes or for concerts and farmers markets and don't want to carry much more than their phone. Second, she said, the system will help the center's stores “cross-market” to one another's customers. For example, a MoneyClip user who buys a movie ticket might then receive a coupon for Jones Bros. cupcakes.
Bockman envisions MoneyClip catching on throughout Omaha and then being able to say, “It started at Aksarben Village. We want to be known as, we are very innovative.”
Bockman plans a formal launch later this summer at an Aksarben Village concert. In the meantime, the free app is available from the iTunes store and for Android devices through Google Play.
Jones Bros., the Juice Stop and the Broadmoor apartments have already started using MoneyClip, and Wohlner's grocery and Learning HQ have signed up to use it. They pay for the service on a subscription basis. Bockman said other Aksarben tenants are in the process of signing up. Pinhook Flats apartments and Noddle will use MoneyClip for its marketing tools but not for payments.
“We can send out specials more easily,” said Rama Kilaru, owner of Wohlner's. “That's the main reason I signed up for that — the marketing. It is more friendly and you can reach out to your customers as many times as you want.”
Jones Bros. owner Bill Jones said he sees it as convenient for customers.
“I don't carry any cash anymore,” Jones said. “I've often thought, why can't we just do all of this on our phone?”
Testing at his shop helped MoneyClip's developers improve the product, for example by adding a bar code so the cashier can scan the phone, instead of requiring the customer to hand the phone over so the clerk can complete the transaction.
“The market will tell us what it's going to do,” Jones said, “but I think it's a great idea.”