Motion of E-payments and transactions on mobile devices
 
#Digital

How Rabobank’s digital wallet delivered commercial and customer success

Global Trends
6 Mins.

While Alipay, Apple, Paypal, and WeChat are the current market leaders in the digital wallet space, banks can successfully create their own-brand equivalents to compete at a local level 

If banks are to survive and thrive in the future, developing cutting-edge digital products and services will be crucial to their success. Even before the onset of the current pandemic the banking sector was experiencing turbulence, with low interest rates, increasing regulation, competition from new entrants, and a shift to digital buffeting their finances, brand equity, and trust with customers. By pushing people to use contactless payments instead of cash and rely more heavily on e-commerce, COVID-19 has accelerated some of these existing trends to such a degree that any five-year plans or innovation roadmaps that banks were working on need to be rapidly rethought.

“One of the pandemic’s most visible impacts on financial services has been the dramatic acceleration in shifts toward e-commerce and digital payments,” McKinsey’s 2020 Global Payments Report stated.1 “Digital payments volumes have soared overall, partially driven by accelerated consumer migration to digital channels and payments forms. This momentum is expected to persist as a next normal develops.”

Digital wallet growth

Wallet shaped smartphone with 100 dollar bills. Mobile payment concept, clipping path included.
Additional products and services that make customers’ lives easier can drive take-up and increase revenue for the issuing bank

Digital wallets – software-based systems that securely store data about an individual’s payment information, enabling them to store funds, loyalty cards, and coupons, and to carry out transactions online or in-store using a smartphone or other mobile device – are one subset of the payments space that is seeing huge growth and offers exciting possibilities.

“In the US, digital wallets attained a level of mass adoption during the lockdown period that would ordinarily take two to three years to achieve“
BCG Fast Forward into The Future report

Last year, Juniper Research forecast that the number of people using digital wallets would grow from 2.3 billion to nearly 4 billion – equivalent to 50% of the world’s population – in the five years to 2024. But BCG’s Fast Forward into the Future report, published in October this year, suggests such forecasts may need to be revised upwards.2 “In the US, digital wallets attained a level of mass adoption during the lockdown period that would ordinarily take two to three years to achieve,” it said.

Banks searching for inspiration need look no further than Rabobank, a trailblazer in the digital wallet space. The second-largest commercial bank in the Netherlands launched its Rabo Wallet App in 2017, offering mobile payment capabilities alongside loyalty, parking, and fuel services. “From the beginning our wallet app was focused on delivering a shopping experience,” explains Rabobank’s Cecile Moerkens.

Watch Cecile Moerkens discussing how the Rabo Wallet App became number one in Google Play Store ​​​​​​​

Value-added impact

While NFC-enabled payment systems are table stakes when developing a digital wallet app, offering additional products and services that make customers’ lives easier can drive take-up and increase revenue for the issuing bank. Rabo Wallet App’s parking service, for example, enables users to find and pay for a metered space with a few simple taps on their smartphone. Once parked, the app locates the exact spot you are in and, when you have returned to your vehicle, calculates how much you need to pay and makes the payment. It is a similar process when using the fuel service. Once at a participating outlet a user opens the app and selects the pump number to be used. When refueling is complete the app automatically pays for the exact amount used and issues a receipt. 

Additional extras are helping to improve the customer experience further: the parking service can suggest the quickest route back to your vehicle if you can’t remember where you left it, while the fuel service can direct you to the nearest participating gas station. Rabobank is also trialing a new feature that enables customers to store a fuel provider’s loyalty card in the app. This digital card is updated with each purchase, enabling money-off rewards to be applied automatically to future fuel transactions.

These value-added services have been key to the success of Rabo Wallet App, helping Rabobank to acquire more customers than the digital wallets launched by its competitors and, most impressively of all, helping to propel the app to the top of Google Play Store rankings in the Netherlands.

An award-winning digital wallet solution

To develop Rabo Wallet App, Rabobank worked closely with global technology leader G+D Mobile Security. Specifically, it selected the company’s award-winning CONVEGO® Wallet solution, which features host card emulation technology and crypto­graphically coded network tokens, enabling end users to manage their digital identities, personalize their mobile wallet, and store debit, credit, and loyalty cards in complete safety. It is integrated into the payment ecosystems of Mastercard, Visa, and a host of local brands, ensuring it can be used as widely as possible. What’s more, it can be branded with a bank’s logos, cards, and marketing collateral, thereby strengthening brand awareness with new and existing customers. Juniper Research honored CONVEGO Wallet with the Platinum Award for Best Digital Wallet in October 2020, cementing its reputation as the leading offering in the market.

As people increasingly search out digital products and services that make their lives more efficient and enjoyable, banks can and should use the knowledge they have about their customers to create new business models. In such a fast-moving environment, the good news is that banks can work with partners who have the skills and technologies that will enable them to profit from the opportunities that the digital world presents.

  1. McKinsey & Company, “The 2020 McKinsey Global Payments Report”

  2. BCG, “Global Payments 2020: Fast Forward into the Future”

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