Payment service emerges as new income source for carmakers
The drivers can make payments with their vehicles after registering their affiliated credit cards in their cars
/NOVOSTIVL/ Financial firms and carmakers here and overseas have begun paying more attention to connected car commerce that enables drivers to make payments using their vehicles, amid the growing popularity of drive-through and contactless payment services following the COVID-19 outbreak, industry officials said Tuesday.
Earlier this month, Hyundai Motor Group hired former Visa Vice President of Connected Commerce Olabisi Boyle, who was responsible for expanding in-car payment technology. At Hyundai Motor America, she will be in charge of the company's mobility strategies, including IT businesses, connected car technology and future innovations.
The automotive group's latest decision was made in line with its efforts to promote connected car commerce.
After introducing "G-Carpay" to the GV80 it launched earlier this year, the group has introduced the same services for the Hyundai Avante, Santa Fe, Palisade and the Kia Sorento.
The number of establishment where the service is available has also increased to 1,233 ― 160 SK energy gas stations and 1,073 Parking Cloud parking lots. According to industry sources, Hyundai Motor Group seeks to join hands with S-Oil and GS Caltex gas stations and retailers having drive-through stores to enable its in-car payment service there.
Credit card issuers and other financial companies are also looking for opportunities in the connected car commerce market.
Shinhan Card developed the G-Carpay module last year.
Since then, Hyundai Motor Group has affiliated with Hyundai Card and other card firms, so that drivers can make payments with their vehicles after registering their affiliated credit cards in their cars.
Woori Card, one of the affiliated card firms, launched a special credit card this year to offer users a "cashback" service when they make payments with their cars at Parking Cloud parking lots.
In the United States, banking giants such as Goldman Sachs, Barclays and Citigroup are reportedly participating in a bid this month to take over General Motors' credit card unit to brace for the connected car era.
GM became the first major carmaker in 2018 to allow drivers to order food and perform other transactions from dashboard touch screens, signing up retail partners including Dunkin' Brands Group and Shell.
Although GM, Goldman and Barclays declined to comment, foreign news outlets expect their bids could accelerate the growth of the connected car industry.
According to technology market consultancy Juniper Research, consumers worldwide are expected to spend more than $100 billion on connected car commerce platforms by 2022.
But the connected car commerce market is still considered to be in its early stages, given that payments are only available at limited places such as gas stations, parking lots and drive-through facilities.
Industry insiders said the increase in the number of affiliated stores will be key to it gaining popularity.
"As internet portals have been able to grow with their users visiting their websites continuously, in-car payment service providers also need their users who make payments with their cars continuously," Shinhan Card Digital First Division director Ryoo Tae-hyun said.
"Most users of in-car payments are still using the service because it is new. In addition to gas stations, parking lots and drive-through stores, more various options are needed in line with changing lifestyles."