Norway has the most effective payment infrastructure in the world. Interesting is to see how and why, so here is a snapshot of volumes and transactions during October 2017 (figures posted at Finans Norge). Local card scheme BankAxept is used in 86% of all card purchases.
- Total card volume, 50.6 billion NOK
- Total number of card transactions, 154.8 million tx
- Volume via local scheme BankAxept, 40.7 billion NOK (80% of total volume)
- Transactions via BankAxept, 133.4 million tx (86% of total card tx’s)
- Rest of the transactions volume was via different international cards, credit cards and digital gift cards.
- Almost 60% of the BankAxept transaction volume was on purchases below 200 NOK (= €22)
My estimate is that cards in Norway stands for approx 85% of the payment transactions in the country, amazing.
China Singles Day 2017, or “11.11” as it also is called, created a new record for Alibaba and fantastic numbers last Saturday. Total sales was at Alibaba was $25.3 billion, 1.5 billion transactions and 90% of the sales was settled on mobile via Alipay. That’s 17k transactions per second during the shopping hysteria day :-).
Read more here.
SEQR (by Seamless) was launched in Sweden in 2011, starting as a QR-based mobile payment method, later adding NFC. SEQR was at merchant chains in Sweden as Hemköp, Willys and McDonalds used SEQR instore, but all is taken’ away.
Seamless is also active in a few other countries, like Germany, Netherlands, Spain, USA and France. The company now say that it “probably” will close down or sell its B2C business for SEQR, to put more focus into B2B-payments.
On Tuesday next week (Oct 24) Apple Pay will be launched in Sweden and in Finland and Denmark, but not in Norway. It will from start be backed by Nordea as first bank, and will be available at merchants 7-Eleven, Pressbyrån & Elgiganten.
Two scientist’s from The KTH Royal Institute of Technology in Stockholm and The Copenhagen Business School, has calculated when cash is not longer accepted at Swedish merchants. The date is calculated as of the trend of cash usage in Sweden and is set to March 24, 2023, only 5½ year’s from now..
The study was done with 741 merchants and shows that 97% of the merchants accepts cash, but that only 18% of consumers transactions are cash. Card payments are dominating with only 0,4% of all transactions done via mobile.
Driving force beside that consumers more and more use cards, is the increase of cash handling cost’s for merchants.
A project called e-krona initiated by The Riksbank, Sweden’s Central Bank, could help consumers that want an anonymous way to pay. The Riksbank say that a decision to introduce e-krona could be taken’ two years from now.
MobilePay, by Danske Bank and with Nordea as partner in Norway, has decided to close their business and payment app in Norway. Instead they will discuss to get into the successful Vipps consortia, as I understand as a distribution partner.
So, the consilidation game in Nordic continues, now with one big and quite successful mobile payment player per country; Vipps in Norway, Swish in Sweden, MobilePay in Denmark, Siirto in Finland and the newly launched Siminn Pay on Iceland. All of these solutions has gain adoption via a free 24/7 person-to-person mobile payment service and from that they go and will get into online/inapp and instore mobile payments.
As it looks just now, each service will focus on their respective local markets, even though rumors say that both Swish and Vipps could show up in “nearby countries” including the three Baltic states.
Read more here.
At a conference in Stockholm last week I got interesting info and a deeper view on Alipay. The Alipay UK representative did tell an amazing story, here are a few points.
- Alipay is not a payment method nor a wallet, it’s a “super life style app”. It includes all needs in a Chinese persons daily life.
- It’s for Chinese people only and has 520 million users.
- 70% of all payment transactions in-store in China is via mobile, amazing!
- One reason is that China seems to have “jumped” plastic cards and use virtual payment cards instead.
- Alipay wants to follow the, today 120 million and quickly growing, Chinese abroad travellers. Hereby Alipay is and will be used in more and more, by Chinese tourists popular city’s, around the world. Last week pilot shops was launched in Stockholm, the first city in the Nordics to accept Alipay as payment in-store.
- Interesting info is that a “good” Alipay user will automatically get an extra €350 credit on their Alipay account when going abroad and to be used abroad.
So, Chinese tourists are, want and will use the Alipay app for also everything when they travel. So if you not in with your attraction, shop, offers and discounts you will probably not get much of their attention or spending.
Norway and Denmark has the most efficient payment eco-systems in the world. Sweden is trying to catch up and we see and will see an interesting play here and on the neighbour markets in the Nordics.
If you ask the banks in Norway they are doing their moves to position against players like Facebook, Google, Apple and Microsoft(!). Signs of this is the consolidation of mobile payment in Norway (eg. Vipps) and resource investments in the Norwegian domestic payment scheme BankAxept.
Below is a summary of recent moves in Sweden and interesting questions “piling up”.
Recent moves in Sweden
- Apple Pay recently say they will come to Sweden, Denmark and Finland (but not Norway?) before end of this year
- Ingenico buys Bambora (acquirer & PSP, payment service provider)
- Swedbank buys PayEx (PSP)
- Klarna, the largest online invoice payment method in Northern Europe, gets a Swedish bank licence and change name to Klarna Bank
- Visa makes a strategic investment in Klarna
- Samsung Pay launched in Sweden (rumours say they will come to Norway in November)
- Swish, the very successful Swedish mobile payment method (5M+ users swishing 8B+ SEK every month) is going into online and instore merchants
- Players like Elavon and AltaPay is building merchant business
Earlier moves in Sweden
- Bambora buys SEB’s acquiring and Samport (PSP)
- Nets buys Nordea’s acquiring and PSP’s PayZone, DIBS (large online PSP) and Teller (acquiring & PSP)
Interesting questions piling up
- Nets is Ingenico’s largest PSP in Sweden but also vendor to Bambora (and PayEx), what will happen now when Ingenico buys Bambora and would they recommend them before Nets?
- Swedbank owns half of Sweden’s largest PSP Paylink (Verifone owns rest), what will happen with Paylink & PayEx, before competitors now in same nest? PayEx to recommend Verifone over Ingenico?
- It`s said that 100k payment terminals in Sweden (1/3 of installed base) needs to be exchanged before year end (PCIDSS security reasons), these will of course be NFC enabled, yet another reason for Apple Pay to go Sweden?
- Sweden, Denmark and Norway has the highest iPhone market shares in the world (50%+), another reason for Apple Pay to go Sweden and Denmark? But why not Norway, maybe the banks there “prefer” the Vipps track?
- And, what will happen with Handelsbanken, the last and “alone” acquiring bank in Sweden? Will Handelsbanken sell their acquiring like SEB and Nordea have already done and if so, to whom and when?
Finally, which bank/s in Sweden will be the first to join the Apple Pay wagon? A challenger bank or one or more of the “big four”? My bet is on Swedbank (one “big four”), trying to be a little aggressive in the market and soon having the control and largest share of NFC enabled payment terminals in Sweden.
Soon we will see.