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Cumberland Farms lures business fleets with mobile fuel payments

Convenience-store retailer Cumberland Farms has extended a version of its mobile-payment system with added perks for businesses to use in managing costs for their vehicle fleets.

The SmartPay Check-Link Business payment program — available in either a payment card or a mobile app — enables business owners to save 10 cents on every gallon of gas they buy for their fleet of vehicles. It is similar to the retailer’s SmartPay Check-Link program for consumers that launched in January 2013.

“Generally speaking, the primary challenges most mobile payment products face are around consumer adoption, usually due to lack of consumer incentives or consumer value,” said Nathalie Reinelt, an analyst at payments consulting firm Aite Group. “In the case of Cumberland Farms, overcoming that challenge will largely depend on how well they educate businesses on their SmartPay Check-Link Business product availability, because it appears that they are actually providing value beyond just convenience.

“Saving 10 cents a gallon may not seem like a lot, but for a fleet of vehicles that could add up.”

Framingham, MA-based Cumberland Farms operates about 600 stores in the Northeastern United States and in Florida. It is the parent company to Gulf Oil LP, a petroleum-products wholesaler.

Added value
Cumberland Farms is also offering businesses that sign up for the program access to an online portal to monitor the daily activity of their fleet as well as monthly statements to help manage gas expenditures. Business owners have the ability to set limits for drivers and generate reports detailing the number of gallons purchased, the locations of purchase and their total savings with the program.

“Those value-added features are exactly the types of services that provide consumers and businesses incentive to migrate toward mobile payments, though I would imagine that since Cumberland Farms is also offering these discounts and analytics by using the debit card, that most drivers will continue to use a card over their mobile phone,” Ms. Reinelt said.

A spokesperson for Cumberland Farms was not available to comment on the program. Aite is not involved in the SmartPay program, but Ms. Reinelt agreed to comment based on her expertise in mobile payments.

Security concerns
SmartPay Business accounts are individually PIN-password protected, and fleet members also have distinct PINs that the administrator oversees. Cumberland Farms has also partnered with the National Payment Card Association in an effort to ensure secure transactions on both cards and smartphones.

Consumers have become increasingly comfortable using their mobile phones for payment, although data security looms as a top concern. According to a recent PayPal survey, 46 percent of U.S. consumers cited fear of data theft as their top concern when shopping online (see story).

Some retail and restaurant chains, along with other service providers like taxi-hailing company Uber, have been testing mobile payments via apps. Both McDonald’s and Starbucks have been leaders in that area (see story).

Ms. Reinelt said the success of mobile payments hinged on the ability of providers to lure users away form payment methods to which they have become accustomed.

“With any mobile payment offering, whether for a large platform or a small retail chain, its success is entirely dependent on design and execution,” Ms. Reinelt said. “Mobile payments just for the sake of mobile payments has proven to be ineffective. Mobile-payment providers that include significant incentives for consumers to abandon current payment methods stand a greater chance of succeeding.”

Final Take
Mark Hamstra is content director at Mobile Commerce Daily, New York