FNB pulls plug on tap-to-pay functionality

Admire Moyo
By Admire Moyo, ITWeb's news editor.
Johannesburg, 02 Feb 2024
Over the years, FNB, like all the local banks, has witnessed a surge in the adoption of contactless payments.
Over the years, FNB, like all the local banks, has witnessed a surge in the adoption of contactless payments.

Big-four bank First National Bank (FNB) will discontinue its tap-to-pay contactless payment functionality in April.

The financial institution this week informed its clients via SMS that the functionality will no longer be supported in the coming months.

It said the tap-to-pay functionality underwent maintenance on Tuesday, and the bank asked users to de-register and re-register tap-to-pay for them to be able to continue using the platform before it is retired.

FNB tap-to-pay was launched to the South African market in October 2016, as the first contactless tap-to-pay digital card wallet in Africa.

According to Jason Viljoen, FNB head of card digitisation, the maintenance of the system has been completed.

“Should customers that have not re-registered experience issues, we encourage them to switch to Google Wallet (or alternative solution) in light of the FNB tap-to-pay sunset in the coming months.”

Grace period

However, he says clients who have not de-registered and re-registered can still tap-to-pay at points-of-sale.

“Yes [they can still use tap-to-pay], but to avoid having to switch to Google Wallet or an alternative solution in the near future, we recommend they rather do so at this time and enjoy the features these alternative solutions offer.

“They can switch to Google Wallet or to one of the other alternative solutions available, such as Samsung Pay, Fitbit Pay, Garmin Pay, Swatch Pay or Apple Pay. Customers can also make use of QR code payments from the banking app at various participating merchants.”

The bank says it decided to remove the functionality because of the rise in popularity of platforms such as Google Wallet.

Internet search giant Google launched its Google Wallet contactless payment service in South Africa in 2022.

Google Wallet can be used to store everyday essentials, such as cards, tickets, passes, keys and IDs, while the Google Pay app can manage users’ money and finances.

Jason Viljoen, FNB head of card digitisation.
Jason Viljoen, FNB head of card digitisation.

South African banks have embraced Google Wallet in the country, as they look to expand their contactless payment solutions.

Over the years, FNB, like all the local banks, has been witnessing a surge in the adoption of contactless payments since the onset of the COVID-19 pandemic.

At FNB, contactless payments now account for over 50% of all card payments.

In an e-mail to ITWeb, Viljoen says the launch of tap-to-pay in 2016 was met with excitement from the local market, due to the global hype around contactless mobile payments generated from Apple Pay and Samsung Pay launching in the US.

“The decision to discontinue FNB tap-to-pay is primarily driven by the launch and uptake of alternate global digital card wallet solutions, most notably, Google Wallet,” says Viljoen.

“In addition to servicing the entire compatible Android smart device base, it [Google Wallet] also supports contactless-enabled smart wearables and integrates seamlessly with the Chrome web browser for a convenient and secure e-commerce online shopping experience.”

He notes the other factors contributing to this decision included simplifying and streamlining in-app customer journeys for Android devices, as users are able to register for Google Wallet from within the FNB app; reducing process and user experience complexity as the bank integrates these solutions into various customer touchpoints, such as card sales, upgrades, etc; and simplifying all communication to the market regarding tap-to-pay solutions with the growing number of alternatives available.

“Our vendor is performing token maintenance on cards enabled for tokenisation prior to January 2022. The tokens associated with these cards expired at the end of January 2024 and cannot be systematically refreshed at this time,” Viljoen says.

Virtual card option

He emphasises it is a simple and quick process to de-register and re-register for FNB tap-to-pay in the banking app.

“However, we encourage users to instead select their virtual card and select to add it to Google Wallet from within the FNB app. In the process of adding the card to Google Wallet, you will be prompted to change your default wallet on your device. Confirm the change of the default to Google Wallet and complete the process.”

The Ombudsman for Banking Services recently warned members of the public about the rise in contactless payments fraud in SA.

According to the banking ombud, it has seen the emergence of a new scam involving the use of near-field communication technology.

The ombud explained that fraudsters are now using stolen bank card information, such as the card number, expiry date and CVV number (card data), to make fraudulent purchases via digital wallets.

Viljoen says FNB tap-to-pay is “very secure”. “The card credentials are tokenised and interactions are encrypted to ensure actual card details are never held by the wallet, nor visible to external participants in the payments value-chain. Access to the digital card wallet is restricted to your personal device and behind device unlock.”