MINNEAPOLIS -- Target Corp. is in the early stages of developing its own mobile wallet, joining Wal-Mart and posing a threat to Apple Pay and the like, Reuters reported.
The mobile wallet would allow customers to pay for goods using an app on their mobile phones. Target, the fourth-largest U.S. retailer with headquarters in Minneapolis, has not committed to launch the product, but the news agency reported it could launch as early as next year. The wallet, however, has not yet been tested in stores.
According to Reuters, Target plans to integrate its wallet into its existing mobile application and does not intend to employ the wireless near-field communication technology used by Apple Pay and Android Pay. Instead, it is leaning toward using QR (quick response) code technology similar to that used by Starbucks Corp. and Wal-Mart. The technology allows customers to scan a code at the payment terminal.
Like Wal-Mart, Target aims to directly link customers’ credit cards to the payment app, and it is also looking for ways to integrate its Red store credit and debit cards, as well as cards from other issuers.
Target’s entry would challenge Apple Inc.’s Apple Pay, Alphabet Inc.’s Android Pay and Samsung Electronics Co. Ltd.’s Samsung Pay. The move also would raise questions about the viability of a plan by a number of retailers, including Target and Wal-Mart, to create a joint mobile wallet, called CurrentC.
Target spokesman Eddie Baeb told Reuters the retailer is testing CurrentC, which is being developed by the Merchant Customer Exchange (MCX), in a few stores, but it is also exploring additional mobile-wallet solutions. He declined to comment on whether Target was developing its own mobile payment service.
“Target is a participant of the MCX, and we are testing its CurrentC mobile wallet with guests as part of a pilot in Columbus, Ohio,” Baeb said.
CurrentC’s aim was to become competitive with credit cards while reducing the fees retailers pay to card companies.
Last week, Wal-Mart became the first member of the group to announce its own mobile payment service, Wal-Mart Pay.
Wal-Mart said it would remain part of the CurrentC consortium, and Reuters reports, Target plans to, as well.
Target does not accept any type of mobile wallet in stores but takes Apple Pay in its mobile application.
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