Advocates of contactless payments may not view a test run of the technology in 25 Asda stores in the United Kingdom as a significant announcement, but the potential exists for eventual mass exposure through the supermarket giant.
Asda Stores Ltd. plans to test acceptance of Visa-branded contactless cards starting in July, in part to coincide with the 2012 London Olympics that begin July 27, the companies announced April 19. PaymentsSource could not immediately confirm whether the retailer also will accept other brands’ contactless cards.
Streamline, a unit of WorldPay UK Ltd., will process the transactions at Asda stores, Visa Europe notes in a press release. Streamline announced last month it had increased transaction speed through a new gateway (
Asda customers using any Visa payWave card will be able to initiate contactless transactions valued at up to £15 (US $24, euros 18.33) without requiring a PIN, the companies stated.
For Asda, a unit of Wal-Mart Stores Inc. with 523 retail locations and a full on-line grocery shopping service, to test contactless payments represents another step in the technology’s evolution in the UK, Zil Bareisis, a London-based senior analyst for research firm Celent, tells PaymentsSource.
Merchants handling many low-value transactions, such as fast-food chains and sandwich shops, were the first adopters of contactless payments because of the transaction-speed factor, Bareisis says. “Supermarkets are a natural next candidate given the frequency of purchases and the wide range of their transactions,” he contends.
“I can imagine Asda and many other grocery stores handling hundreds and thousands of purchases during the day that are less than £20, which [in June will] be the new limit for contactless [for transactions not requiring a PIN],” he adds.
However, many grocery shoppers also likely will spend £200 or more, and contactless payment would not be as useful for those transactions, Bareisis contends.
Visa Europe also sees Asda as a key player in making contactless an accepted payment method.
"The rollout of contactless technology by organizations like Asda is helping to set the scene for a major change in the way we pay,” Mark Austin, Visa Europe head of contactless payments, stated in the press release.
UK retailer WHSmith PLC also began accepting contactless payments last month through arrangements with Visa and Streamline, while Co-operative Food Group Ltd. established contactless payment in its pharmacies for consumers using Visa Barclaycards, according to British media reports.
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