U.S. Bank pockets new digital wallet
- Article by: JENNIFER BJORHUS
- Star Tribune
- October 24, 2012 - 9:52 AM
U.S. Bancorp is offering customers Visa Inc.'s V.me, the digital wallet service Visa has been rolling out to simplify the online checkout process.
The Minneapolis-based lender is the second U.S. bank to have integrated Visa's new service, as both incumbents stake claims in the rapidly evolving electronic payments market. Last week, Pittsburgh-based PNC Financial Services Group and 1-800-FLOWERS.COM announced they were offering Visa's service.
U.S. Bank, the country's fifth-largest bank, is a major issuer of Visa cards and also processes plastic for a number of card companies, including Visa. The bank said Tuesday it will offer V.me to all retail customers of the bank with a U.S. Bank-issued credit or debit card.
The bank couldn't immediately say how many people that is but estimated it's in the millions.
In an interview, Jennifer Schulz, global head of e-commerce at Visa Inc., called the digital wallet service one of the company's "top priorities." Banks are a great way to introduce it to people, she said, and more banks are in line to join.
When consumers sign up with V.me, they create an account with their card information, billing and shipping addresses. The information is stored in the Visa infrastructure. Participating merchants offer a V.me checkout button allowing customers to check out more easily without entering a lot of data. The merchant gets the sale; U.S. Bank gets a slice of revenue each time the card is used.
The service is similar to PayPal, eBay Inc.'s alternative online payment service. But Dominic Venturo, chief innovation officer for U.S. Bank Payments Services, said he thinks V.me is easier to navigate. It also has the advantage of the Visa name, he said, calling it "one of the most trusted brands in financial services from a consumer perspective."
MasterCard Inc. introduced a similar electronic service in May called PayPass.
Venturo said he thinks the friction customers feel when they try to check out online and complete a purchase is the single biggest competition for V.me, as opposed to any one player such as PayPal.
"For businesses that do e-commerce transactions, this is potentially significant because one of the biggest issues is an abandoned shopping cart," he said.
Forrester Research predicts that U.S. consumers will spend $327 billion online by 2016, up 45 percent from $226 billion this year.
Jennifer Bjorhus • 612-673-4683
© 2014 Star Tribune