A new land grab in the mobile payments industry is beginning to take form among banks, credit card issuers, and mobile app providers; loyalty services. Creating solutions for merchants, these payment vendors are creating payment products that merge traditional payment systems like credit cards and domestic bank transfers, with loyalty points. The products follow the existing model that credit card companies having been using for years, which provides discounts or gifts from partners such as airlines or retailers when making purchases with them.
Adding a mobile element, app providers are creating systems that allow for mobile payments, as well as integrate discounts and loyalty points from participating merchants. These apps allow for users to make payments directly from their phone and receive notifications of discounts. Geo-enabled apps can also allow merchants to target customers when they become near their stores. As a result, the current land grab among these mobile developers is signing up consumers and merchants, as well as signing deals between payment companies and app developers.
Relating demand for such products, MyCheck, a mobile payments firm focusing on the loyalty market has announced that they have raised $5 million in series B funding. Leading the investment is Spanish bank, Santander. The investment is part of Santander’s $100 million Innoventures Fund which invests in fintech firms, with an emphasis in payment products.
According to MyCheck executives, the funding from Santander comes as the firm reached out to the bank following last October’s launch of the Innoventures Fund. Currently operating in its home market of Israel as well as having expanded to the US, UK, and Brazil since 2013, MyCheck plans on using the new funds to expand their US and Western Europe presence.