What are in-car payment systems (ICPS)

Our relationship with our cars is changing. We’re going from paying with cash, to credit card, to mobile app and now, car makers are integrating technology into cars, which will pay for fuel, parking and, in the future, even turn around an insurance claim in 30 minutes.

Already, the pandemic has provided a glimpse to the ways in which our cars can become extensions of our homes, with some workers setting up mobile offices, complete with comfy seats, connectivity and quiet away from the noise of the kids, stuck home in lockdown.

Companies are constantly looking for ways to ‘remove the friction’ of our life experiences. Unexpected traffic on a familiar route? Friction. Finding a parking space? Friction. Hunting for change trapped in the cubby? Friction.

Through the integration of In-Car Payment Systems (ICPS), car makers are beginning to remove points of friction for drivers to provide a better in-cabin experience.In fact, in-vehicle commerce is expected to generate a projected £375 ($500) billion for businesses by 2030.

Here are some ways we as motorists will be contributing to that chunk of in-car payments:

Parking
A number of manufacturers have integrated parking applications into their infotainment and connectivity suites. In the US, Hyundai, Genesis and Renault Samsung all offer ways to pay for fuel, parking and toll roads from the comfort of the cabin.

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In June 2021, BMW UK announced that RingGo has been integrated into BMW Connected Drive. Though we’ve seen this solution before in Volvo’s outgoing Sensus suite, the ‘Pay’ element of ‘Park and Pay’ didn’t always work.

It’s hard to argue that life isn’t easier with parking apps like RingGo, which have negated the need for an episode of ‘Let’s Go On A Coin Hunt’ every time you want to park.

RingGo is simple. Open the app, key in the parking area code—displayed on posters around the car park—select the number of hours you want to park and confirm the card you want to debit.
RingGo adds 10p per hour to cover the cost of providing the service, but that seems a small price to pay to avoid a £60+ fine.

Fuel
Since 2017, big brand fuel names, such as BP and Shell have enabled their customers to pay for fuel at their stations from their mobile handset. Shell teamed up with Jaguar to integrate the same feature directly from the Jaguar InControl interface.

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Customers select the location of the station, which pump and confirm the card they wish to debit, the information is remotely confirmed by the pump back to the app and drivers can step out, fill up and then get back in the car, without touching anything but the pump handle.

Shell has also been trialling automatic payment technology for Mercedes-Benz trucks in Germany, successful enough that we may see the same technology in cars in due course.

What will frustrate motorists when it comes to in-car fuel payments is the requirement to go into each individual app, depending on which brand’s petrol station they’re at. There’s also a good chance independent petrol stations will get left behind, even though they offer some of the most competitive fuel prices.

Discounts and Shopping
Waze, Telenav and Google Maps have, for some time, looked at ways of integrating advertising into the connected car experience. Offering discounts at locations proximate to the location of your car is going to become pretty normal, provided it doesn’t cause drivers to be distracted.

At a US tech show in 2017, BMW showcased the ‘En Route Delivery’ concept with partner, Amazon, where a Prime Now order was placed and delivered to the vehicle, en-route to its destination. Bearing in mind, Volvo has offered its parked cars as available delivery points for logistics company for some time, there is no doubt that the integration of retail will increase with the development of ICPS.  

Insurance
The shift the insurance industry is currently undergoing can only spell a better future for all motorists. We’ve seen the use of black boxes since around 2011, introduced to help calculate policies for teen drivers. They monitor data points from the car, such as acceleration, braking, journey length, speed, which are then communicated to a database, known as ‘telematics.’

This use of telematics is helping insurance actuaries calculate more personalised insurance policies. Using information about you and your driving habits, more cautious drivers will no longer be tarred with the general conclusions drawn from anecdotes.

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The integration of black boxes has been mandated in all cars made for the European market from May 2022. This is going to mean further use of technology and telematics, which, according to Martyn Matthews, Senior Director of Personal Lives at LexisNexis, could eventually “enable drivers to claim [and receive a payout] in as little as 30 minutes”, after collision, through the centre console display in the car.

Since Apple Pay and Google Pay are more widely accepted than ever before, so there’s an argument for leaving ICPS to the Apple Carplay and Android Auto mirroring apps.

Yet, some experts have cautioned car makers against allowing Apple and Google to dominate the in-cabin experience, since it might force drivers to choose their next new car based on which handset they have, rather than which car features suit them best. The big bone of contention is also the use of customer data, over which car makers would be relinquishing control.

Ensuring security of consumer credit card data, addresses and purchases is key to making a success of in-car payment. As other car makers have done, Daimler Mobility recently announced their agreement to partner with Visa in its MBUX suite. Visa has a raft of technology to ensure data is appropriately secured through encryption, authentication and verification, using biometric technology for the latter criteria.

We’ve all used our fingerprint or facial recognition in recent years and can testify that it’s not yet flawless. There’s little doubt, however, that ICPS will continue to expand so motorists should stay curious.