Even though mobile payments are gaining adoption during the coronavirus pandemic, the chicken-and-egg problem still persists: The wallets only work when both the issuer and merchant have the technology in place.
Most alternatives sidestep this hurdle by going purely software-based, tying into social platforms like Facebook — or creating their own, like Venmo — to create their own network effect without additional hardware.
Payments technology entrepreneur Will Graylin envisions a way to combine these two approaches with OV Valet Superkey, a payment card and digital wallet that can initiate touchless payments at more than 90% of all payment terminals. It pairs with an app that supports messaging and live chat functions.
That promise echoes what Graylin did with LoopPay, a company whose Magnetic Secure Transmission (MST) technology allowed smartphones to wirelessly mimic the signal generated by swiping a magstripe card.
While that acquisition was good for Samsung, it also meant that the technology was locked into Samsung's ecosystem, and any non-Samsung customers still needed merchants to support NFC payments for their mobile wallets to work.
OV Valet, a small payment card attached to a key chain, aims to recapture the promise of LoopPay while acknowledging that the audience for such a product is looking for something a bit more robust than a multi-account card.
OV Loop will have a commerce messaging to allow users to see an invoice, make a payment, or engage in a live chat through the OV Valet app, or through the bank or business website. In this way, the app provides the social payments aspect more familiar to users of Venmo or WeChat Pay than to a smartphone maker's mobile wallet.
"OV Valet is the universal tap-and-pay with the MST technology, but it will draw consumers into this whole world of digital payments that works for everyone, everywhere and also draws you into the WeChat equivalent here in the U.S.," said Graylin, CEO of
OV Valet will also support NFC. Graylin plans to allow the card brands, issuing banks or retailers to put their brand on both the OV Valet card and commerce platform.
Currently, OV Valet uses credit and debit rails for transactions, and plans to include real-time payments in the future when the banks and recipients have RTP-enabled accounts. This would open the door for bill payments and a P2P platform in the future.
"This concept is not new in terms of the all-in-one cards, but the idea of just being able to tap through and identify the card of choice and eliminate what you have to carry around is very appealing," said Richard Crone, chief executive of San Carlos, Calif.-based payments consulting firm Crone Consulting LLC. "Will Graylin has always been a visionary, and I have the utmost regard for him, and his moves could be compared to Apple's moves in every major disruptive technology."
However, OV Valet will have to differentiate itself from past all-in-one efforts like
"The differentiator is the conversational commerce," Crone added, "and the social payments aspect that can emulate a Venmo, WeChat Pay, Apple Pay Cash in iMessage, and other social payment experiences."
While OV Valet seeks to address a situation in which many banks are not yet fully embracing digital payments and customer service experiences with their customers, that remains a difficult nut to crack, Crone contends.
"Keep in mind there are still thousands of banks and credit unions that don't support the current 'Pays' and even more that do not issue contactless cards and [do not support] P2P schemes such as Zelle," Crone added.
Many banks justify non-participation in digital payments due to the cost, such as giving up five basis points on an Apple Pay payment, and between 45 and 90 cents per Zelle transaction, Crone said.
Plus, OV Valet adoption trusts that consumers are indeed carrying around keychains or would want to have a small card attached to a keychain, rather than using their phone for contactless payments, Crone noted. "Automobiles, homes and other methods of authentication are moving to use the phone as the token, " he said.
Graylin is counting on other factors coming together like a puzzle that will give U.S. banks and consumers a digital experience they haven't been able to secure through other providers.
"We need the ingredients to put together a solution for Americans that makes sense," Graylin said. "In the U.S., even during COVID, waiters are coming to your table at a restaurant and taking your card to the backroom to swipe. That is changing, but at a pace no one knows how long it will take."
OV Valet seeks to quicken that pace through its universal wallet and commerce messaging platform.
"You only need one OV Valet card (about half the size of a regular payment card) on your keychain, as it can hold multiple cards," Graylin said. Users press a button on the card to initiate a payment through their designated top-of-wallet card, and press twice for use of the secondary card. It also allows you to locate a lost phone by pressing three times, or conversely, the user can stop the OV Valet, if lost, through a command on the mobile phone.
OV Valet will work at terminals that have magstripe readers, which Graylin estimates gives it coverage at 94% of terminals. He has it narrowed down to that percentage, mostly because it would not work at some terminals in which readers are embedded deep in the hardware, such as at airport parking lots or certain gas pumps. Some terminals also have software that major card brands have not supplied, and they might not be equipped to handle track data errors, Graylin added.
Acceptance at more terminals is critical, Graylin noted. "When you lock in a wallet to a specific phone type, whether Samsung, Android or Apple, you are limiting the use of it for everybody," he said. "When you are a slave to waiting for migration at the POS, and it even happened with EMV, it can take a decade-plus and it is not easy."
As such, OV Valet takes the guesswork out of what most merchants are using at the POS to accept payments.
"We are offering a universal, touchless payment with the bank brand on it, so we don't have to wait for the acquiring side to catch up," Graylin said. "We are not waiting for merchants to decide what they are going to adopt; we are working with existing systems they already have."
Graylin introduced OV Loop in 2018, his initial reveal that his technology was going to combine conversation commerce and payments.
OV Loop was powered through host card emulation technology that Graylin acquired from SimplyTapp at that time. OV Valet also uses HCE to enable payments at NFC terminals. The card does not need a phone nearby to work, making it an option for those jogging or working out at a gym or in other situations in which carrying a wallet or purse is not practical.
Prior to OV Loop, Graylin had established his footing in the payments industry through the creation of Roam Data and its mobile payment technology. He sold Roam Data to Ingenico in 2015, after years of significant investments from the terminal maker into the Roam technology.
OV Loop is taking pre-orders for OV Valet, starting at $69, with plans to start shipping the cards during the first quarter of 2021.
"We certainly want the banks to start looking at branding these cards themselves and having it as part of a package on a shelf," Graylin said of OV Valet. "If banks want to differentiate and draw customers in from a universal wallet, this would be the way to do it. If we get the banks on board, that will have a momentum of its own."
