The mega retailer-backed mobile wallet enterprise Merchant Customer Exchange has had a rough couple of weeks. First MCX received an onslaught of criticism for reminding its merchant partners that they cannot contractually accept the mobile wallet transactions of competitors. Then a data breach of the MCX pilot program reportedly compromised the email addresses of MCX mobile wallet users. Payment pundits have remarked that these are not auspicious developments for a mobile wallet scheme that hasn’t even yet launched.
After Apple Inc. launched its mobile wallet, Apple Pay, in October 2014, MCX partners and drugstore chains CVS pharmacy and Rite Aid began accepting near field communication (NFC)-based Apple Pay transactions at their retail outlets. Then came word from MCX regarding the pharmacies’ contractual obligations to the providers of the CurrentC mobile wallet; MCX ordered the drugstore chains to turn off the NFC feature on their in-store POS devices so NFC-enabled transactions, such as Apple Pay transactions, could not be accepted.
The public fallout from that decision apparently prompted MCX Chief Executive Officer Dekkers Davidson to post a blog on the MCX website that said, “MCX merchants make their own decisions about what solutions they want to bring to their customers; the choice is theirs. When merchants choose to work with MCX, they choose to do so exclusively, and we’re proud of the long list of merchants who have partnered with us. Importantly, if a merchant decides to stop working with MCX, there are no fines.”
While payment analysts picked apart MCX’s stance, another public relations challenge arose for the Boston-based mobile-wallet provider when a data breach was brought to light on Oct. 28. In a blog post MCX said, “Within the last 36 hours, we learned that unauthorized third parties obtained the email addresses of some of our CurrentC pilot program participants and individuals who had expressed interest in the app. Many of these email addresses are dummy accounts used for testing purposes only. The CurrentC app itself was not affected.”