payments and connected cars

Bringing out the Best in Your Commute

Unless you are a freelancer, chances are you spend at least half an hour or more each day commuting. That usually means five days per week traveling to and from your workplace in a car or public transportation. And while mobile devices and the Internet can provide diversions during your daily commute, the commerce sector is doing its best to provide commuters with opportunities to connect with retailers and payment service providers.

These efforts have brought together the automotive and retail sector, along with payments and mobile service providers, making the likes of Hyundai and Honda the forerunners of a growing connected vehicle ecosystem that, according to Digital Drive Report, brought in USD 212 billion in the US alone.

Shopping on the Go

Some of the biggest online and mobile purchases made by commuters naturally include gas and coffee. In fact, PYMNTS research in 2018 revealed that more than half connected commuters order drive-through coffee via apps.

Drive through coffee in itself is a big business, with NCA's report for 2018 reporting that 44% of research participants bought coffee at a drive through, with 24% using an app. Starbucks has for years been at the forefront of good business practices when it comes to mobile payments: back in 2013, mobile payments accounted for 11% of their sales volume or around four million transactions per week.

In general, shopping while commuting has proven to be a significant boon to commuters, with expenses for groceries and other foods totaling over USD 90 billion per year.

When the time comes to stop your car to pick up said groceries, you can pay for parking the same way.

Voice Assistance is Key

But buying isn't the only thing connected commuters want from their apps. Research clearly points to loyalty, coupons and discounts having a greater appeal than making purchases or locating brick and mortar stores.

Consequently, many retailers have made it a point to offer such benefits for commuter transactions via apps. However, another technological development is also becoming increasingly important to this emerging connected cars and payments ecosystem: voice assistants.

In addition, the Digital Drive Report states that over 50% of commuters are making use of voice assistants to shop and make payments while driving and commuting. The most used assistants are respectively: Siri, Google Assistant, Alexa, Bixby, Cortana, Extreme- Personal Voice Assistant, and Dragon Mobile Assistant. It is projected that there will be an increase by 31.9% in commuter spending with Google Assistant available in a vehicle's dashboard.

And why is this so? It is of course convenient, you don't have to take your hands off the wheel and it saves you time that you can use to do something else. Naturally, the next step in the evolution of connected cars is already on its way. Samsung has already presented its Digital Cockpit 2019, which integrates the smartphone voice assistant with the car, allowing the driver to use the VA for anything from setting the temperature to monitoring gas levels.

Honda has also made forays into the same area with its Dream Drive prototype which aims to provide both commerce and infotainment services to drivers and passengers. The automotive giant is expanding its relationships with payments providers. In fact, Visa and Honda just announced a proof-of-concept connected car that makes paying for things, like gas and parking, easy and painless. Drivers no longer need to rummage through their wallets to pay by pump or meter; instead, they pay via two in-car apps.

Powered by Visa Token Service, a secure platform for mobile transactions and in-car payments will soon be within a driver’s reach. Drivers will be able to view and complete their purchases at smart parking meters and fuel pumps directly from their Honda consoles.

As a longtime partner of Visa, who for their part have announced a partnership with Sirius XM on an in-vehicle payments solution, Honda will now collaborate with Mastercard, but also PayPal, bringing their services to its customers.

This partnership with Visa and Mastercard allows Honda to take full advantage of the card companies' significant experience and know-how in the area of shopping and payment via mobile devices, such as for example Visa's Token Service.

The Dream Drive in-vehicle payment system therefore aims at allowing drivers to pay for anything from fuel and parking to groceries and concert tickets, all from the comfort of their car, with just a few taps or via a voice command. The connected car has already become a new source of revenue and epicenter of commerce, and with new developments - from integrated voice assistants to fully self-driving vehicles - it is set to only grow in importance for the global retail and payments sector.