Dive Brief:
- The Canadian company BlackBerry Limited is partnering with Oakland, California-based fintech firm Car IQ to develop technology to enable secure, vehicle-based payment capabilities by using its cloud-connected in-vehicle software platform (known as BlackBerry IVY) and direct access to vehicle sensors, the companies said in an Aug. 11 press release.
- Connected car payments system will allow automakers to create a “digital fingerprint” for a vehicle allowing it to connect to a bank’s payment network. The system validates and autonomously pays for a wide range of services, including gas, tolls, parking, insurance, and maintenance via its “wallet.”
- “We are delighted to demonstrate the value of BlackBerry IVY’s end-to-end offering for this market through our partnership with Car IQ,” Peter Virk, BlackBerry's vice president of IVY Product and Ecosystem, said in the release. “Access to sensor data and edge computing will allow for an incredibly secure in-vehicle payments solution.”
Dive Insight:
Transaction revenue in the burgeoning vehicle-based payment market is projected to reach $622 billion from 600 million cars globally by the end of the decade, according to a 2020 industry report by PTOLEMUS Consulting Group, a Brussels-based firm focused on connected mobility and automation.
BlackBerry, the company once known for handheld electronic devices and now focused on selling security software, aims to tap into that demand in partnership with Car IQ. BlackBerry's separate QNX security and connected technology already is embedded in some 195 million vehicles worldwide, including those made by BMW, Ford, GM, Honda, Mercedes-Benz, Toyota and Volkswagen, the company said in a June press release.
As for the system in development with Car IQ, a BlackBerry spokesperson said it's expected to be launched early next year. The company declined to say which car-makers it's working with, but offered this by email: "Car IQ currently targets commercial vehicle fleets and treats the vehicle itself as the payment source so a fleet operator can view payment transaction history and insights on a per-vehicle basis not per-driver basis."
BlackBerry IVY was created as part of an earlier multi-year partnership between BlackBerry and Amazon Web Services aimed at developing a cloud-based system through which automakers would have a "consistent and secure" means to read vehicle sensor data and offer in-car services features, according to a release last year from retail giant Amazon, parent to the web services unit.
Car IQ is charging ahead after also announcing this week in a press release that it has raised an additional $15 million from venture capital firms and companies, including BlackBerry as a new investor. In the past, Car IQ has produced "software developed specifically for fleet vehicles," the company said in that release.
Car IQ CEO and founder Sterling Pratz noted in the release with BlackBerry that their tie-up will produce a product that streamlines the car wallet transaction process for banks and merchants. In addition, the benefits for drivers and passengers will mean they no longer have to juggle multiple apps to communicate with specific merchants or service providers when they engage in an in-car transaction, like filling the gas tank, paying a toll or finding a parking space.
More than a dozen automakers have connected car payment programs under development, or are close to rolling out one, including FCA (Fiat Chrysler), GM, Audi, Honda, Hyundai and Tesla, according to the PTOLEMUS report.
Honda first announced efforts to build in-vehicle payment capabilities at the giant consumer electronics trade show CES in 2017, and demoed a prototype of the system built into the Honda Passport SUV at CES in 2019.
In March, Mercedes launched its “Fuel and Pay” contactless system in cars, with connections available at more than 900 gas stations in Germany, according to a company press release. It’s accessed through the infotainment system inside the car or the Mercedes vehicle management app available through on mobile device, eliminating the need to pull out a credit card at the pump. The participating gas station is identified using a geofence technology, which communicates a car and driver’s location when parked at the pump. The system calculates fueling needs based on tank capacity, fuel type and price, with the customer authorizing payment amount.
Other use cases for such technology include using the car's wallet to pre-order food and drink at rest stops or finding and booking parking. But consumer security and data privacy concerns will need to be addressed before there is widespread adoption of connected car payments, according to a September 2020 report by the cybersecurity tech company Trustonic.