MCX Says QR Payments App Will Pivot To NFC If Necessary, Won’t Fine Retailers Who Break Exclusivity

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In a virtual press conference today, MCX‘s CEO Dekkers Davidson said “We’re agnostic about technology. We started with QR code-based technology that allows us to go to market broadly. If we need, we can pivot to NFC.” That means if retailers strongly prefer the NFC system used by Apple Pay to MCX’s mobile payment app CurrentC’s QR code system, CurrentC could switch to the more popular and graceful near field communication protocol. Davidson noted that MCX is working with retailers on “other technology that goes beyond QR codes” already. And specifically, MCX merchants are excited about Bluetooth Low-Energy solutions.

In response to the New York Times’ allegations that it would make retailers pay fees for breaking their exclusivity agreements and using other mobile payment methods like Apple Pay, Davidson said he was aware of the reporting around this matter, but that “it’s simply not true, there are no fines”.

MCX is a mobile payment technology company started by a consortium of retailers led by Walmart, CVS, Rite-Aid, Target, and other top chains. Started in 2011, MCX was tasked with creating a mobile payments method that would let the retailers sidestep the 2% to 3% fee they pay credit card companies when their customers pay via swipe in brick-and-mortars.

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MCX’s app is slated to launch in early 2015, but has made waves because its exclusivity deals with CVS, Walmart, and Rite-Aid led those retailers to stop supporting the newly launched Apple Pay method that employs NFC readers already installed at the stores.

Davidson also detailed a hack of its email system that was revealed this morning, saying its email provider was hacked, though he wouldn’t disclose the name of the provider. He says the hack exposed dummy zip codes and “some tester email addresses.”

“The CurrentC app itself was not affected. We own this and are taking it seriously,” he said. The investigation is ongoing, and involves security experts and partners organizations. Stolen email addresses were not stored in the cloud.

CurrentC PoliciesThe CEO went on to say that he “can’t speculate about the motivations of those who did the hack. Unfortunately in the digital age, some people think it’s cool to hack.” He continued, “the hack reminds us that there are people that are motivated to steal information. Our systems have been attacked repeatedly in the last 7 to 8 days…clearly any type of attack or incident is one you have to learn from to get stronger –  and we will get stronger. We’re challenging the status quo…when you poke at a large ecosystem like that, you should expect attacks.”

In fact, MCX did anticipate interest from hackers, which is why the CurrentC app was built around security. Payment credentials are not stored on device, but are stored on secure server in the cloud which was designed to anticipate regular attacks.

To conclude, Davidson discussed why retailers or consumers would want to use CurrentC instead of Apple Pay.  When asked about the need for exclusivity agreements, a reporter asked, “What’s the harm in competition?” Davidson responded there’s no harm. When asked if MCX and Apple Pay could ever be used side by side, he said, “In the future, that could be entirely possible…there will need to be two to three strong players in the ecosystem. One won’t simply build the market.”