Back in 2014 a number of retailers funded a mobile payment plan called CurrentC that was being developed by a retailer-supported consortium called Merchant Customer Exchange (MCX for short). The plan was to roll out a competitor to the then-new Apple Pay program from Apple Inc. (NASDAQ: AAPL) in the first half of 2015. That did not happen.
What did happen is that MCX last week announced that it is suspending its beta-testing of the CurrentC mobile app in Columbus, Ohio, on June 28 and postponing further releases of the product.
MCX had some heavy hitters among its sponsors, companies like Wal-Mart, Best Buy and Target. The idea behind the CurrentC app was to let retailers avoid the hated swipe fees charged by credit card companies like Visa, MasterCard and American Express. That would give the retailers using CurrentC another 2% or 3% either to keep or use to offer promotional pricing to attract more customers.
The hope was to emulate the highly successful mobile app Starbucks Corp. (NASDAQ: SBUX) has developed over the past three years. The Starbucks program started out as a loyalty card that morphed into a payment card, and Wal-Mart Stores Inc. (NYSE: WMT) last month launched its own mobile payment app, Walmart Pay, at 590 stores in Arkansas and Texas. Wal-Mart said its mobile app is used by some 20 million people a month, and when Walmart Pay is finally rolled out nationwide, the payment app will automatically appear on customers’ mobile devices ready to go.
Former Wal-Mart CEO Lee Scott is reported to have said, “I don’t know that MCX will succeed, and I don’t care. As long as Visa suffers.” It looks like MCX may not succeed and Visa Inc. (NYSE: V) won’t suffer — at least not from competition from MCX. Visa’s stock has more than tripled since 2011, the year that MCX was founded. In the same period, Wal-Mart stock is up about 35%, well below the S&P 500 increase of nearly 65%.
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