Ahead of Google’s annual I/O event kicking off later today in Mountain View, the company is unveiling its latest developments for Android Pay. The mobile wallet for Android-powered smartphones is opening for business in the UK — its first market outside the U.S. (where it launched in September 2015) — starting out on NFC-enabled Android devices running KitKat 4.4 or later.
Android Pay will let you make purchases of £30 (about $43) and under with a single tap after you upload a Visa- or MasterCard-based credit or debit card from one of the banks supporting the service (see below). No need to unlock the phone unless the price is higher.
This news also signals more developments on the international front: Google also said it will soon be turning on Android Pay in Singapore and Australia.
The debut should come as no surprise for two reasons: Google announced in March that Android Pay was coming soon to the UK. Then yesterday evening, Google Tweeted that the service was on its way after accidentally pulling the trigger too early to note it was live.
Tap to pay = big in the UK
Notably, American Express is not yet included in the card types supported (it’s available in the U.S. though so watch this space). Google says that banks supporting the service include Bank of Scotland, First Direct, Halifax, HSBC, Lloyds Bank, M&S Bank, MBNA and Nationwide Building Society, “with new banks being added all the time.” (Barclay’s is one of the biggies not on the list.)
Google is highlighting Android Pay support from a number of popular retailers, services and apps such as Starbucks and Boots pharmacies; the London transportation network; Deliveroo, YPlan and more. The company told me that it’s not disclosing the terms of its deals or what kind of commission or other data that it receives on each transaction.
Google last week gave a preview to journalists and analysts to show how Android Pay works, using an Android handset to tap to buy coffee at Holborn Grind and to travel from Holborn Tube station. But it may not have been necessary: the company is tapping (heh) into a well-used contactless payment system that has been in place in the UK for some time now.
Google tells me that the payment service will work anywhere that contactless payments are accepted, and that nets in a very wide range of venues. Contactless chips are embedded in most payment cards here and retailers and consumers have been using the technology for quick transactions for years already (also for sales under £30 as of September 2015).
Apple Pay has had a head start in the UK, launching in July 2015, but Apple’s mobile wallet includes an extra step to work. It requires users to authenticate the transaction on an iPhone by logging in with TouchID at the point of sale. That might sound sensible if you’re a risk-averse consumer or retailer; but fiddly and time-eating if you’re someone who is always looking for ways to do things quicker.
Perhaps because consumers already have several options for how to pay for things with other contactless services, Google is hoping to sweeten the deal for Android phone owners to start using the service with its loyalty program called Android Pay Day, “bringing special offers each month to brighten the last week before pay day,” Pali Bhat, Senior Director, Product Management, writes in a blog post announcing the news. Deliveroo and Starbucks will be the first to offer Pay Day deals.
As with Android Pay in the U.S., the UK service is built using tokenization, which means that your card details are not passed between the phone and the retailers when you make a transaction. Instead, the system uses a virtual account number and logs the details of the sale for you to track.
With the integration with Transport for London (operators of London’s rail, bus and subway network), there is an added bonus. Along with a log of where you have used Android Pay, the wallet tracks when you’ve forgotten to “tap out” when coming off the Tube or a train. Normally the Oyster system that TfL uses just charges you for the maximum cost of a ride when this happens; but if you use Android Pay you’ll now get a warning when you pass the machines to remind you if you forget.
This is helpful, but to me it could be even better: if it can sense you’re leaving, why not just automatically tap out for you?
Another point that’s notable is that Google has waited until now to launch Android Pay here in the UK — not least because contactless payments and Apple Pay are both already here and getting used. It’s possibly a mark of how Google wanted to make sure it gets the experience right from the start, lest the public or regulators find any other reasons to scrutinize the company.
In any case, there is a track record for how technical and public missteps in mobile payments can leave a project dead in the water. If you recall, Android Pay is Google’s second attempt at developing a mobile payment service. Others that have stumbled include Softcard, the payments initiative formerly known as Isis that eventually was picked up by Google; and most recently CurrentC, the mobile wallet backed by a retailer consortium that has now been postponed indefinitely.
A video of how Android Pay works is below: