Royal Bank of Scotland Steps Back Into Mobile Payments Market

May 3, 2019         By: Steven Anderson

It was a whole different world for mobile payments 10 years ago. Apple Pay was still about five years off, and for most people, the notion of paying for things on a smartphone was ludicrous, as they’d maybe only had a smartphone for about two years. The iPhone itself had only come out two years prior, after all. Back then, Royal Bank of Scotland (RBS) had its own entrant in the mobile payments stakes, but lost it in a series of calamities. Now, it’s re-evaluated the market and come back for revenge and revenue alike with a whole new mobile payments entry.

Back around 2009, when the world was reeling from the impact of the Great Recession and people genuinely thought the financial advice in “Gremlins 2: The New Batch” about “canned food and shotguns” was pretty sound, RBS sold its Worldpay arm.

Worldpay was RBS’ first foray into the then-young mobile payments market, but RBS needed cash in the wake of the economic disaster, and as part of the terms of a bailout, RBS had to drop the company. Given that Worldpay was recently purchased by Fidelity National Information for $43 billion, reports note, it’s clear that the notion had value. Now, RBS has a new arm in mind.

The entry in question, reports note, is known as NatWest Tyl, and it serves as a “merchant acquiring service” geared toward the small and medium-sized business (SMB) market. With NatWest Tyl, users will be able to accept card payments in both brick-and-mortar outlets as well as online. NatWest Tyl itself, meanwhile, will make money on establishing connections between the customers and the Visa / Mastercard networks.

Ultimately, we must ask if this is too little, too late. Some might say yes, but remember, Zelle managed to jump to prominence in a field that Venmo pretty much created on the strength of bank name recognition backed by a quality product. It’s not out of line to think that RBS might do likewise; it’s got plenty of customers and more than enough data to field some amazing analytics projects that could help it succeed.

Only time will tell how well RBS’ plan works here. The field may be crowded, but RBS has a couple of excellent weapons backing its collective play.