Commbank’s queue buster

While it might be Australia’s largest financial institution with more than a century of history, CommBank’s latest project pits it against tablet manufacturers such as Apple and Samsung and software developers such as Square. The bank announced its intention to build Albert – essentially a hybrid between an EFTPOS terminal and a consumer tablet – in July last year and is on track to launch it within the next few months.

Albert uses CommBank’s Pi operating system based on Android. This is all new development since the technical specifications were only made available at the time of the announcement eight months ago. “Any Android developer can use our software development kit and create whatever application they need, with the exception that they can’t try to take a payment any other way because we have to make sure it’s secure,” Bayer Rosmarin says.

“Not only that, but our customers themselves, the big ones, can develop their own applications that are specific and unique to their organisation.”

The idea of Albert is to free sales assistants from standing behind a cash register, so they can serve customers and take payments on the shop floor.

Retailers can either integrate their existing point-of-sales (POS) software and inventory systems into the payment processing function on Albert, or use apps to handle the sale.

“We found from consumers that one of the things they uniformly hate is standing in queues, yet most retail environments are designed around the idea that people have to queue,” Bayer Rosmarin says.

“We wanted to untether the device and make it possible for the payment to come to you. From an application perspective, we also wanted to make the payment interaction much richer and enable our customers to differentiate their experience at that critical moment.”

There are already apps that can process payments on an existing iOS or Android smartphone or tablet, such as those offered by Square and CommBank’s own Leo product for iPhone and iPod Touch.

The difference with Albert is that the tablet has been custom built for taking payments and is manufactured with a slot where customers insert a card and a chip reader. Customers enter their PIN through an encrypted keypad on the touchscreen, which CommBank says is a world first.

CommBank has not moved into hardware manufacturing itself – the bank worked with design consultancy IDEO and then outsourced production to a German company Wincor Nixdorf, which makes ATMs and EFTPOS terminals, to build the tablet. The commercial deal gives Wincor Nixdorf control over the intellectual property for the hardware, while the bank retains ownership of Pi.

CommBank’s existing product, Leo, takes card payments through a case integrated with an iPhone or iPod Touch. Leo has functions such as splitting the bill but CommBank is limited by the need to get approval from Apple to release via the App Store. Bayer Rosmarin says this approach would not work for a generic tablet, because there are no cases in production that would allow transactions to be done chip and pin to keep down fraud rates.

“Tablets don’t really work in the real world and the reason is that in Australia … there is a strong preference for transactions to be done chip and pin,” she says. “It’s not a long-term solution especially where taking money is concerned. It’s a whole different level and we know what criminal gangs do when they target ATMs and EFTPOS terminals. If we could have used a tablet that was out there ... we absolutely would have. We could have waited for someone to come up with a solution or we could have said ‘no, the time is right to change this industry and if no one else is doing it, then we’ll step up’.”

She says that many larger companies did not want to equip staff with iPads or other tablets more expensive than an EFTPOS terminal that would be “objects of consumer desire” for a transient workforce.

CommBank will approve Pi-based apps for Albert and release them through the App Bank. Bayer Rosmarin says some of the third-party apps in the pipeline include catalogue display, inventory top-ups and redemption of marketing offers at the point of sale. CommBank is also developing a number of apps in-house, including tools to split the bill, tip service staff or donate to charity, email a receipt or keep an open tab at a bar or local store.

There is also a business assistant function to help store owners reconcile transactions at the end of the day and provide such data as payment type and location of credit card customers.

The digital strategist for retail consultancy Retail Oasis, Nicole Venter, says the Albert device could be great for retailers. “It’s good to see Commbank continuing to innovate beyond the curve, creating a very flexible POS system and completely changing the approach from what is quite a locked development process to an open one, directly asking the consumer (or developer in this case) to tell them what they want.”

However, Venter says the fact the product is from a specific bank rather than a generic payment provider such as Google, PayPal, BPay, or Visa would limit global uptake and some retailers would be put off by this.