Dutch Banks and Telcos to Move Forward on M-Payment Project

Jul 8 2010

Three major Dutch banks and three mobile operators have decided to move forward with planning for an NFC mobile-payment launch in the Netherlands, NFC Times has learned.

The three Dutch banks, Rabobank, ING and ABN Amro; and three telcos, believed to be KPN, Vodafone Netherlands and T-Mobile Netherlands; gave the project the green light at a meeting June 28, following months of discussions, NFC Times has learned. The approval clears a major hurdle for the initiative and means the parties intend to move forward to lay the groundwork for a likely launch sometime in 2011–probably in the latter half of the year, sources told NFC Times.

UPDATE: Rabo Mobiel was earlier reported as a member of the group, though sources say T-Mobile Netherlands is the sixth member. Rabo Mobiel will probably join later. In response to a request for comment from NFC Times, a representative from T-Mobile Netherlands confirmed the telco was “participating in the technical and commercial feasibility study” related to the project. END UPDATE.

But the parties are not releasing any details until they announce their plans, expected in a month or two. Representatives from KPN, Rabobank and ING, believed to be the most active members of the group, along with T-Mobile Netherlands, all issued nearly identical statements to requests for comment from NFC Times about the mobile-payment project. 

“We are currently looking into the technical and commercial feasibility of such a service; we have nothing to say until this study is concluded,” said a statement from KPN.

The statements are the first public acknowledgment by the parties of the project. As NFC Times reported last week, the three banks and three telcos, dubbed the “Six Pack” by project organizers, have been engaged in secret talks for months about the possibility of offering customers contactless payment supporting Visa payWave or MasterCard PayPass on NFC phones. 

The parties had planned to make a decision around April, but delayed it. The banks and telcos are not only wrestling with the question of the business model, that is, how to share revenue, but also how to jump-start the rollout of contactless point-of-sale terminals in the Netherlands to accept payWave or PayPass applications on NFC phones and possibly other contactless-mobile devices and cards. The contactless-payment infrastructure is almost nonexistent in the Netherlands.

"You need NFC phones and POS terminals to make NFC payment (work); both are not yet there, but if you would have the major banks and telcos in the Netherlands in a joint project, that should give the project enough power to make that happen," said Tonnis de Boer, senior management and technology consultant for Netherlands-based e-payments consulting firm Innopay, when told of the project by NFC Times.  

As NFC Times reported earlier, the banks and telcos would also likely set up a national trusted service manager, or TSM, which they would co-own, to download and manage the payment applications on SIM cards or other secure elements in the phones. SIMs will likely be the preferred secure elements in the phones.

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