Olswang is a pan-European business law firm with experience in technology, media and real estate.
 
Here, Mobile Money Exchange talks to Rob Bratby, partner for telecoms and technology at Olswang, about the legal issues behind the world of mobile payments.
 
MMX: What legal issues commonly come to the fore with regard to mobile payment solutions?
 
RB: There are a variety of different mobile payment solutions either in, or shortly to enter, the market and the applicable regulation varies from solution to solution. However, regulation stemming from the Payment Services Directive and new E-Money Directive, as well as electronic communications rules and consumer protection rules are typically relevant. The intersection of these different types of regulation poses some novel challenges for market players and their advisors.
 
MMX: How do regulators help or hinder the process of implementing a mobile money solution in Europe and the UK? What do law firms like Olswang do to help out companies facing the regulators?
 
RB: In contrast to some other areas (e.g. roaming!), regulators have generally taken an approach that seeks to encourage market entry, investment and innovation in this space. As a result, in the UK we have seen players such as O2 apply for an e-money licence in its own right, whilst Orange and Barclays have partnered to jointly develop services. These market players require a mix of regulatory advice to help them understand the art of the possible, and the constraints, on their activities. They also require advice on partnering and supply contracts against that regulatory backdrop and finally assistance with consumer terms.
 
MMX: What sort of technology issues do you see arising in the mobile money space? Why are they cropping up and what can be done about them?
 
RB: At the moment the technology is still emerging and so not every handset is yet equipped with NFC capability and not all merchant terminals will work with every product. In addition, the products have different capabilities. In our view unless there is more progress on common standards and a clear common customer proposition, these differences may hind widespread consumer adoption. However, we see that the increasing penetration of NFC equipment android devices into the smartphone mid-market together with a greater understanding of customer needs addressing these issues over the medium term.
 
MMX: Where do you see mobile payment services going in Europe?
 
RB: In contrast to the developing world where services such as M-PESA are providing alternative to traditional banks, we see mobile payment in Europe as not being an end in itself, but being more a building block component in more sophisticated services. A good example of this is when mobile payment is integrated with location based advertising, whether through the device or through more traditional media. This will enable fulfilment rates for particular 'calls to action 'to be tracked in a way that is currently only possible on-line, in a real world context, which will enable advertisers to understand campaign effectiveness to a much greater extent than currently.