Connected Car and Contextual Payments

Publication Date: May 2024

Executive Summary

The convergence of automotive technology and digital payments has given rise to a transformative concept: the connected car and contextual payments ecosystem. This U.S. Payments Forum white paper delves into the intersection of these two domains, exploring the potential, challenges, and considerations for implementations.

In recent years, the automotive industry has witnessed a rapid evolution driven by connectivity, data analytics, and automation. The connected car, once a concept limited to infotainment, has evolved into a hub of sophisticated sensors, telematics, and communication channels. This evolution opens up avenues for safer, more efficient payments experiences, vehicle-to-vehicle communication, and integration with smart city infrastructure.

At the same time, the world of payments has been undergoing a digital transformation. Mobile wallets, touchless payments, and seamless online transactions have become the norm. Contextual payments, a novel concept, leverage real-time data and situational awareness to facilitate frictionless transactions. When applied to connected cars, contextual payments enable many use cases, from in-car purchases (e.g., fuel, tolls, parking) to personalized services (e.g., entertainment subscriptions, food delivery) that enhance the driving experience.

However, this convergence also presents challenges that must be addressed. Security and privacy are paramount, as the exchange of sensitive financial information within a vehicle’s digital ecosystem raises concerns about data breaches and unauthorized access. Interoperability standards are crucial to ensure seamless collaboration among automakers, payment providers, and technology developers.

The benefits, nonetheless, are substantial. For consumers, the connected car and contextual payments integration offers convenience, time savings, and personalized experiences. For businesses, new revenue streams, data-driven insights, and opportunities for customer engagement are possible.

This white paper provides an analysis of the synergy between the connected car and contextual payments. It explores real-world examples and equips stakeholders across industries with the knowledge needed to navigate this evolving landscape successfully. At publication, new use cases are emerging into the marketplace that are not covered by this white paper.

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