South Africa’s First National Bank (FNB) officially launched their Geo-payment system today, which will enable users to send and receive payments when in close proximity to other users. The system is app-to-app based, meaning that a payer and a receiver will both have to be in close proximity and have the FNB mobile app installed.
The app makes transferring money from one person to the other a seamless experience, as users don’t need to set up pre-defined beneficiaries or add people to their account. The service is also available for non-FNB customers through the banks eWallet facility.
“When we launched the banking app, we thought that all the other banks will also have apps out soon – but that wasn’t the case. In the month that we launched, we had 100 000 customers, and I predict that we’ll have 330 000 customers next month, spurred on by the launch of geo-payments,” said FNB CEO Michael Jordaan during the launch in Johannesburg.
Jordaan continued to confirm that FNB’s banking app has been the number one application in most mobile operating systems’ content stores since its launch, with about a 28% split each for Android and BlackBerry, while the remaining 44% of users make user of Apple devices.
“We promised to be a launch pad for innovation, and I have the pleasure in launching geo-payment. It puts the cool factor in ordinary payments, and at FNB we encourage our people to take on the bold and daring,” Jordaan said.
Jordaan commented that many in the industry said that FNB was ahead of their time when the app launched, but “we constantly need to spot opportunities. Smartphones are no longer just for voice or text, and we need to stop calling phones a phone – it’s a mobile device.”
The geo-payment app works on three principles: find, link and pay. The user who is making a payment will find a user who accessed the app and selected “Receive payment”. The two phones will then be paired together and the secure transaction will be completed.
“There are many possibilities for contactless payments in the future. We haven’t activated it yet for business accounts, but right now it’s available for person-to-person transactions”.
FNB users should be concerned about the cost of using such as service, as just as with the banking app, the fees for using the geo-payment system is included in the monthly banking fees – making it essentially a free service.
The geo-payment system might also reduce the number of users who need to go into a physical branch to make a transaction, but Jordaan said branches are here to stay. “However we do see paper and cash disappearing in time,” he continued.
The service should not be confused with Near-Field Communication (NFC), as geo-payments make use of GPS technology as well as triangulation within a short range.
Charlie Fripp – Consumer Tech editor