Fintech’s Revenue Lessons for the Automaker

The pandemic lockdowns have seen merchants scrambling to find ways to let people buy and pick up food and products without getting out of the car.

Yet some brands have thrived in this new normal, according to Scott Mackay, vice-president of global digital commerce for Fiserv. With Fiserv enabling nine of the top 15 largest quick-service restaurant brands in the world, its data shows digital payments escalating. In the quick-serve sector, digital payments grew 75% since January 2020. Fast-casual restaurants saw a 341% increase in digital payments for curbside pickups.

“QSR brands focused on lunch and dinner that already had a good omni-commerce strategy had an uptick in digital payments of anywhere from 80% to 150% since January,” Mackay says. That includes fulfillment via drive-through, curbside pickup or in-store pickup. While, eventually, some of that demand may be taken up by in-restaurant dining again, retailing and restaurant experts believe curbside pickup is here to stay. In other words, automakers should plan now to take a slice of commerce in the car.

Fiserv’s Mackay notes that sometimes, commerce via the car makes more sense that using the phone. One example, of course, is fleets. Changes in consumer behavior and business models may make it more logical to tie payments to the car, for example, car-sharing services, delivery services and ride-hailing services.

In the case of shared car payments or insurance, Mackay notes, “You don’t want that tied to your phone, you want it tied to the vehicle.”

In other cases, it might be difficult to get people to give up their phone apps.


Credit card issuers including Visa and Mastercard have already integrated payments into automaker apps, while car manufacturers themselves look to integrate payments into mobility services. There may be growing interest in paying via the car for convenience-oriented services, according to a January 2020 survey conducted by SBD for Otonomo of drivers in the EU and UK. More than half said they were interested in on-demand car washing where the car was parked and 40% liked the idea of the car suggesting coupons.

While there’s growing adoption of digital and mobile payments, a proliferation of electronic wallets and payment schemes is confusing for consumers. According to a 2020 report from Worldpay, now part of FIS, digital and mobile wallets will handle 52% of all global transactions.

There are strong regional differences, however. E-wallets will handle just 10.8% of point-of-sale transactions in the US; 5.3% in Latin America; and 9.4% in EMEA by 2023. In the Asia Pacific, on the other hand, e-wallets are already the favorite way to buy at the POS, with use growing from 35.9% in 2019 to 45.1% in 2023.

However, outside of China, e-wallets, whether digital or mobile, are dominated by incumbents: Apple Pay, Google Pay, Samsung Pay and Amazon Pay. This represents a barrier for in-car payment offerings put forward by car brands and their partners.

As we’ve seen in the automotive apps market, consumers have been resistant to adopting automakers’ apps, preferring to use their phones, whether by connecting them to the infotainment system via Android Auto or Apple CarPlay, or simply placing the phone on a holder mounted on the dashboard.

Pay by voice

Mackay notes that completely hands-free authentication models, such as voice or facial recognition, will make it easier to integrate payment solutions with merchants and reduce the friction in car commerce. ExxonMobil and Fiserv are working to let drivers pay at the pump via Amazon Pay by saying, “Alexa, pay for gas.” It will locate the car, activate the pump and facilitate the payment digitally through Amazon Pay, with a digital receipt provided to the driver.

Cerence, the automotive spin-off from Nuance, recently announced Cerence Pay, described as providing a seamless payment transaction that starts with intent to purchase, authenticates via voice and facial biometrics and completes the transaction. Audi will build Cerence Pay into future Audi head units, Cerence says.

Cerence’s current partners are Parkopedia and Arrive, both parking services. Eventually, the company sees integration of navigation, restaurant reservations, takeout purchases and fueling.

For example, when a driver puts a restaurant’s address into the nav system, the system could ask if she wants to make reservations, how many are in the party and what time. The same system could identify available parking spots, reserve one and pay for it, all in natural language.

This isn’t something that could comfortable fit and be used on a phone, says Nils Lenke, vice-president of apps at Cerence, because it would require the user to manually start apps and insert pins for payment. Instead, he says: “It’s inserted into the overall experience. The driver doesn’t have to discover it, the system invites them to use it.”

Wheel is already invented

The commerce system is robust and well built-out, says Mackay. If automakers attempt to do direct interfaces with merchants, it will be too complex and merchants will be unwilling to adopt it. Rather than attempting to launch their own payments, Mackay says: “OEMs and technology providers should try to leverage existing infrastructure. It’s too risky for the OEM not to do so.”

A big advantage at their disposal is car data, according to Cerence’s Volker. Just as Apple takes 30% from every in-app purchase, car makers can do the same. In fact, he thinks there’s potential for carmakers to get a revenue share from Apple and Google. “The right thing to do is to open up and partner with other services,” he says. “OEMs understand opening up is an opportunity but there is big risk.”

Automakers have already made big mistakes, for example, by not keeping hold of the repair industry. “They understand data and services is the same thing. They’ve learned the lesson and are not going to give it away this time. They want to be part of the ecosystem.”

Following other e-commerce models, Lenke says car manufacturers can and should get a revenue share for business they send to merchants and that share could be significant. “It’s a game-changing thing for them,” Lenke says. Typically, when app or service providers approach automakers about integration, it’s a cost factor but Cerence is promising no cost and additional revenue. How much remains to be determined. He points out that the purchase price of a car is a small fraction of how much an individual spends on the car in its life span. For example, parking and fuel adds up to as much as the sticker price. Yet, carmakers get nothing from it. Lenke says: “This is a way for them to participate in revenue streams they don’t see now.”

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