Retailers including Wal-Mart Stores Inc., Target Corp. and Best Buy Co. are forming a company that would allow customers to pay with their mobile phones as they work to gain control over the growing method of doing business.
The company, named Merchant Customer Exchange, or MCX, already is developing its mobile application, the retailers said Wednesday.
The app is expected to integrate a variety of coupons, rebates and loyalty programs.
The retailers see an opportunity to grab part of customers’ mobile payments as more shoppers adopt the technology. The venture also may reduce the amount of swipe fees the chains pay when consumers use a credit card.
Retailers have a strong position in the arena, since they can decide which forms of payment to accept.
“As merchants, no one understands our customers’ shopping and payment experience better than we do, and we’re confident that together we can develop a technology solution that makes that experience more engaging, convenient and efficient,” Mark Williams, president of financial services for Best Buy, said.
“MCX will leverage mobile technology to give consumers a faster and more convenient shopping experience while eliminating unnecessary costs for all stakeholders,” added Mike Cook, Wal-Mart’s corporate vice president and assistant treasurer.
The platform will be available to all kinds of merchants, including retail stores, casual restaurants and gas stations, Cook said.
Work on the network comes amid a proposed $6.6 billion settlement between merchants and Visa Inc. and Mastercard Inc. over a lawsuit concerning credit card swipe fees. The settlement faces opposition from retail trade groups and individual retailers, including Wal-Mart and Target.
Credit-card swipe fees, which average about 2 percent of each transaction, generate about $40 billion a year for banks such as JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc.
Other retailers included in Merchant Customer Exchange are 7-Eleven, Inc., Alon Brands, CVS/pharmacy, Darden Restaurants Inc., HMSHost, Hy-Vee Inc., Lowe’s Cos., Publix Super Markets Inc., Sears Holdings Corp., Shell Oil Products US, and Sunoco Inc.
The initial retailers that are part of the new company account for about $1 trillion in annual sales. More retailers are expected to be announced as new members in the coming months, the group said.