Target Aims To Unveil Smartphone Payment Service In 2017

By Christine Kern, contributing writer

New “TargetPay” app will be initially available to Target REDcard holders.

Retailer Target is planning to launch its own mobile payment service to “one or more of its own apps” later this year, the company’s Michael McNamara has told Recode. While it is unclear whether Target will add the payment feature to its main Target app, its popular Cartwheel coupon app or both, the service will initially be available to customers with Target REDcards.

McNamara told Recode that providing shoppers an option that allows them to pay and use a mobile coupon “would make sense,” suggesting that payment features could be added to the Cartwheel app, which connects with customers in store, using push notifications to offer exclusive discounts and integrating third-party coupons. Target also began testing a new Cartwheel perks loyalty program in September, offering points from purchases to customers.

According to 9to5Mac, Target has accepted Apple Pay in its mobile app since Apple’s mobile payment service launched in 2014, but the retailer still doesn’t take Apple Pay in stores. Apple Pay adoption by retailers is slowly picking up with 35 percent of US retailers accepting it at checkout according to Apple, and GAP retail stores are planning to start accepting Apple Pay this year. Target also accepts Android Pay online. Now,  the retailer has unveiled plans to introduce its own mobile payment solution later this year, suggesting that it will not be jumping on the Apple Pay or Android Pay bandwagons any time soon.

Target is not the only retailer to go the route of its own payment app. Walmart and Kohl’s have each added mobile payment features to their own apps over the past year. Target also was one of the original backers of CurrentC, a separate payment app that was piloted but abandoned.

McNamara told ReCode that the new payment option would only be available to REDcard holders, “at least initially.”