Bokis, a collective of more than 60 Danish banks, has become the first organisation in the country to offer mobile payments using the national debit and credit card Dankort.
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The card is linked to the banking collective’s mobile wallet, which was launched in February.
“We have an audience in the customers of Danish banks who are very used to contactless payments and digitalisation,” said Søren Nicolaisen, director at Bokis and the Association of Nationwide Banks. “[The mobile wallet] was the next natural step. If we are not doing it with the banks, then someone will else do it. We want to be frontrunners in this market.”
The Bokis partnership comprises 62 small and medium-sized co-operative, local and savings banks in Denmark, together with five regional banks – Sydbank, Jyske Bank, Nykredit Bank, Arbejdernes Landsbank, and Spar Nord Bank. Together, the banks’ customer base covers more than 40% of Denmark’s 5.6 million population.
Dankort is Denmark’s most popular payment card, and was used for about 1.4 billion payments in 2016.
The collective’s NFC mobile wallet was first rolled out for Android devices and expanded with an iOS version in late March. Behind the application is Nordic payment services company Nets, which last year was contracted by Bokis members to develop and launch its own mobile wallet. The company is also the technology provider for Dankort.
The mobile wallet uses Nets’ host card emulation technology and tokenisation platform to ensure secure contactless mobile transactions. This works at the point of transmission by replacing the payment credentials stored on the mobile device with a unique, randomly generated identifier (a token) to make sure the information exchange between the device and the payment terminal does not contain any sensitive data.
Larger Bokis banks have their own branded version of the mobile wallet app, while the local banks use the collective’s standard My Wallet app. Initially, these six wallet apps were only available to customers of Bokis banks, but they have since been offered to customers with payment cards at other banks that support the technology.
Among the first retailers to accept Dankort mobile payments are Danish supermarkets through a separate Bluetooth payment terminal. Nets said all merchants that already accept contactless Dankort payments will also be able to support mobile payments after a software update to their point-of-sale (POS) terminals.
With their mobile wallet, Bokis banks are closing in on Danske Bank’s successful money transfer app MobilePay. Since the app was launched in 2013, it has been downloaded 3.4 million times, but payments expert Henning Jensen at Danish consultancy PlusCon said most of its popularity stems from person-to-person payments and it has not had the same success in the POS environment.
“It will be interesting to see what payment product the cardholder will select for POS mobile payments, but it will take two to three years before we see the winner,” said Jensen.