What is MCX and how does it affect consumers?

A few days after the Apple Pay launch, 40-50 odd retailers shut off Near Field Communication on their terminals to prevent transactions made via Apple Pay. These retailers are part of an association known as the Merchant Customer Exchange, or MCX and include brands like CVS, Walmart, Best Buy, Gap Inc., …etc.So why would retailers part of the MCX do this?

The goal of MCX is to build better relationships with their customers and truly understand their customers they began working on a competing mobile payments wallet named CurrentC. Although a noble goal, CurrentC won’t be available until 2015 and under the terms of their MCX contractual agreement brands cannot work with competitors to accept payments via mobile device like Apple Pay.Additionally, if these retailers broke their contractual agreement, then they would be fined. This is why companies like CVS or Rite Aid turned off the capability to accept mobile payments via Apple Pay shortly after its launch. It’s also why several brands chose not to support Apple Pay from the beginning.

It’s safe to say that MCX’s decision to prevent NFC-based payment systems from their stores would has not gone well so far. While MXC claims that CurrentC is a “bold challenge” to the current mobile payments landscape but it doesn’t appear to be getting very far with bad reviews on both the iTunes App Store and Google Play.

‍Blogs like re/code have questioned the exclusivity rule. Even TechCrunch called it a “Clunky attempt to kill Apple Pay and Credit Card Fees”.Many times anti-competition can be anti-innovative, let’s hope for MCX’s sake and our own that this is not true. The CEO of MCX, Dekkers Davidson does not believe this to be true. He feels that the exclusivity will give the group time to “breathe” for CurrenC’s development.

Although the exclusivity can be difficult for many eager Apple Pay users, Davidson has mentioned that it should end in a number of “months, not years”.

‍Let’s hope for the best in the growth of mobile payments and expect these changes soon.