Vodafone’s European Mobile Wallet Debuts in Spain

Vodafone Group marked the launch of its European mobile wallet initiative in Spain last week, revealing plans to expand it into Germany next month and other parts of Europe early next year.

The mobile network operator says it is offering the first Near Field Communication mobile wallet service through the GlobalPlatform open standard, meaning banks, retailers and transportation companies can provide virtual cards and services through the wallet.

Vodafone’s entry into Spain will add to the country’s mobile wallet landscape, as last summer, the European Commission approved wireless carrier Telef-nica's project with Spanish banks to develop “a virtual community” for digital advertising, data analytics and person-to-person payments.

At first, the wallet will feature only Vodafone’s SmartPass mobile payment app, a Visa prepaid account. In the future, the mobile carrier will seek the addition of bank cards, travel cards, loyalty cards, gift cards and vouchers.

That variety of cards will, over time, replace the plastic cards in a consumer’s wallet or purse, Vodafone says in a press release.

Vodafone has been preparing to launch a European wallet for a couple of years now, and its announcement of a partnership with Visa laid the groundwork for the company to first include a Visa prepaid account at launch, says Zil Bareisis, a London-based senior analyst at research firm Celent. Vodafone first revealed the potential plans for Spain and cited the Visa partnership two months ago.

“I think the proof of the pudding will be wide-spread integration of bank-issued cards into the wallet,” Bareisis says. “Vodafone says they are working on it, but such cards are not yet available.”

By spring of 2014, Vodafone also expects to have the wallet available to consumers in the Netherlands, U.K. and Italy.

Consumers can fund the Vodafone SmartPass through other accounts. They can make purchases with their smartphones at any Visa contactless payment terminal in the world, including more than 1.2 million in Europe, Vodafone says.

Consumers using the Vodafone wallet can make contactless payments of less than £20 (25 euros, US$33) and higher value payments when using a PIN.

The Vodafone wallet will currently operate through the SmartPass app on NFC-enabled Samsung, Sony and HTC phones, but the carrier says it plans to “expand the range rapidly in 2014.”

Those using mobile phones without NFC capabilities can use the SmartPass app to apply for an NFC tag that can be attached to the phone. Those using an NFC SmartPass tag would need to fund their SmartPass account through the Vodafone website, the carrier says.

Vodafone U.K. remains involved with Weve, the European mobile commerce initiative that originated as “Project Oscar” more than two years ago. In the past year, the project became Weve, with an emphasis on mobile marketing and advertising, with the payments facet to come later.

While Weve works on its own mobile wallet and plans to potentially add a payment scheme next year, carriers in Europe have continued to move forward with their individual plans.

“It was always expected that individual mobile network operators would continue to push forward with their own solutions, such as O2 Wallet or Orange Cash,” Bareisis says.

The carriers likely would leverage Weve’s marketing platform where it makes sense, such as programs in which merchants provide loyalty programs or regular offers, Bareisis adds.