Microsoft is attracting interest in multiple countries for its collaboration with FreedomPay, which enables banks and large businesses to use consumer purchasing data for targeted offers.
"Payments is transitioning from a transaction business to an information business information about where people shop and how much they spend is extremely valuable," says Colin Kerr, industry solutions director on the worldwide banking team at Microsoft.
Microsoft is building a payments platform as a service, utilizing FreedomPay's mobile or card-based payments processing and portal to create offers. The partnership launched in September, and although Kerr would not name any bank or merchant clients, he says, "there's been very substantial interest in North America as well as the Netherlands and the U.K.," as well as Mexico.
Banks are trying to solve a loyalty problem, preventing consumers from losing their trust in big banks and switching their accounts. It's more expensive for banks to sign up new customers than it is to keep existing ones, Kerr says. "If the bank is able to connect consumer customers to its business customers and start to become more influential in the spending chain," it'll be able to keep its relationships, he says.
Microsoft chose FreedomPay because it was already leveraging Microsoft's cloud technology for its offers and promotions platform and developing for Windows Phone 8, Kerr says. Microsoft can cross-sell other products, such as business intelligence and customer relationship management tools, to FreedomPay merchants.
In July,
FreedomPay's vice president of marketing, in an email. With the backing of Microsoft FreedomPay is now focusing on white-labeling our solution to retailers, banks, and consortiums to create their own payment ecosystems."
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These initiatives indicate that "we want to be an innovation enabler in the payments value chain," Kerr says. "We take technologies that we have developed on the payment platform as a service and make those available so they can innovate."
Microsoft will make money by charging for technology services used by mutual customers, Kerr says.
