Partnership between TARGOBANK and E Plus

• TARGOBANK (subsidiary of Crédit Mutuel-CIC) and the German telco E-Plus have announced contactless tests to take place starting in the end of July. To begin with, these experiments shall concern the companies’ staff members and rely on MasterCard PayPass stickers (to be placed at the back of the mobile devices).

• The amounts of the transactions made using this system are debited from the associated card account (he NFC-based solution stands as an extension of this card). Cardholders receive an SMS each time a transaction is made. Also, this offer does not only apply to E-Plus customers.

Source: TARGOBANK press release

• While waiting for a precise and lasting contactless model to prevail, Germany focuses on card media and other cheaper devices, easier for customers to comprehend, and ensuring faster adoption. In this case, stickers have been associated with card media for more convenience.

• Nationwide introduction of contactless payment is planned by August 2012, and would imply renewing roughly 16 million cards (out of 45 million) by the end of the year. Stickers have been selected as starters, but they are only temporary: with time, mobile phones with embedded contactless technology may be preferred.

• This announcement also asserts the German banking industry’s interest in contactless technologies as large-scale rollouts are planned in the Hannover-Braunschweig-Göttingen-Wolfsburg Region –“girogo” project (see April 2012 Insight).

• Several temporary solutions are envisaged to favour the adoption of contactless payment: Landesbank Berlin for instance proposes microSD chips NFC and a removable card reader (see January 2012 Insight).