Starbucks Rolls Out Bar-Code Mobile Payment Nationwide

The Starbucks coffee chain has announced it is rolling out mobile payment nationwide to its nearly 6,800 company-owned stores in the United States, using 2-D bar-code technology–in what it calls the largest mobile-payment service in the country.

Consumers can use the service by downloading a Starbucks Card Mobile app to their Apple iPhones or iPod Touch devices and a variety of BlackBerry models. Starbucks is reportedly developing a similar app for Android phones.

"Today, one in five Starbucks transactions is made using a Starbucks Card, and mobile payment will extend the way our customers experience and use their Starbucks Card," said Brady Brewer, vice president Starbucks card and brand loyalty, said in a statement.

The payment service is also available in Starbucks outlets in 1,000 Target discount department stores in the United States. The coffee chain had been piloting the service in these stores along with other outlets in Seattle, New York and Northern California.

The chain hasn’t released figures on transactions for the extended trials of the mobile apps, but said the reloadable Starbucks Card, on which the mobile service is based, “continues to experience significant customer adoption.” Customers loaded more than $1.5 billion on Starbucks Cards in 2010, up 21% compared with 2009, the company said. It credited the growth of its prepaid store card in part to the rewards program connected with it.

The chain has said it is interested in using NFC technology to enable customers to use their phones to pay, but has noted that few NFC phones are available.

"Mobile payments could be powered by NFC someday, but bar codes are our proxy right now," Chuck Davidson, category manager for innovation for the Starbucks Card told NFC Times earlier. "My job is innovation, and while I’m a big fan of NFC, I feel a tremendous need to get to learning about mobile payments as quickly as possible."

Starbucks also has resisted efforts by U.S. banks and the major payment card brands, Visa Inc. and MasterCard Worldwide, to accept contactless payment in its U.S. stores. The chain likewise has so far rejected the idea of making its Starbucks Card contactless.

With the bar-code app, after the customer scans the 2-D bar code at the point of sale, Starbucks deducts the amount of the purchase from his Starbucks Card account over the network. The app also lets cardholders track the card balance, add to it with a major credit card, check the status of rewards points and locate nearby Starbucks outlets. IPhone users also can reload with their PayPal accounts.

Starbucks said more than one-third of its U.S. customers use smartphones–nearly three quarters of them BlackBerrys and iPhones. A number of smartphone models are expected to support NFC this year, including some BlackBerry and Android models and perhaps the iPhone. But not all will necessarily support card-emulation mode, at least not at first. That would be needed to enable consumers to tap their phones to pay with the Starbucks Card with full security.

Some NFC industry observers point out that bar-code-based payment is much less secure than NFC or cards using smart card technology. For example, a fraudster could make a copy or take a picture of a customer’s static bar code and simply put it in a PDF or JPEG file on his own phone to use. The NFC-based payments would also be faster, they say.

Starbucks told NFC Times last fall there were no documented cases of the Starbucks Card Mobile app getting hacked.

Article comments

AmayaY's picture
AmayaY Jan 24 2011

In a move initially tested over the last year, Starbucks cell phone payments are going live.
I found this here: Starbucks mobile phone payments going live in all US stores.
The app is currently accessible on iPhone and Blackberry. An Android app is within the works, but not currently available. The app relies on bar code scanning to transfer installments.

Please register or login to post a comment.


Sydney to Test Multimodal Payments Involving Private Mobility Providers Using Digital Closed-Loop Card

NFC Times Exclusive Insight – A trial to be held later this year in Australia’s largest city, Sydney, if it proves successful, could offer one example for how agencies can encourage customers to take multimodal transport combining public and private operators. The economics behind the New South Wales government’s trial offer are unclear, however.

Rome Transit Operator: Covid Accelerates Demand for Contactless Payments but Customer Habits Hard to Change

NFC TIMES Exclusive Insight – The CIO of Italy’s largest public transit operator, ATAC SpA, said the Covid-19 pandemic has accelerated demand for open-loop contactless and mobile payments, but added that old habits are hard to break for customers and use of cash and paper tickets are still popular.

Dubai Transit Authority Plans to Launch Its Closed-Loop Card in More NFC Wallets

NFC TIMES Exclusive Insight – Dubai’s Roads and Transport Authority, or RTA, which in December first launched mobile fare payments with a digital version of its closed-loop card in Huawei smartphones, says it plans to expand the service to other OEMs, including Apple and Samsung.

Case Study: Transit Agency in Portugal Combined NFC with BLE for Mobile Ticketing; Faced Challenges

NFC TIMES Exclusive Insight – The agency that runs ticketing for 19 public bus, tram and train operators serving Porto, Portugal’s second largest city, says it has had success–and faced several challenges–with the rollout of its Anda mobile-ticketing app.

OMNY Hits New Usage Milestone as Open-Loop Payments Rollout Continues

NFC TIMES Exclusive Insight – New York’s Metropolitan Transportation Authority, or MTA, says it continues to see steady growth of its open-loop fare payments service, OMNY, announcing 50 million taps by customers using NFC wallets and bank cards to ride the massive New York City Subway and the city’s buses.

In-Depth: Contactless Open-Loop Pilot in Spain First Project from Vendor Partnership

Mar 11 2021

NFC TIMES Exclusive Insight – Bilbobus, which operates bus service for the city of Bilbao, in northern Spain’s Basque region, says it launched its recent trial of con

Moscow Metro Plans Rollout of ‘Face Pay’ Technology for Fare Collection

NFC TIMES Exclusive Insight – The Moscow Metro plans to roll out facial-recognition technology at every station by the end of 2021 to enable customers to pay fares, officials say. The project, while delayed, would be the largest of its kind globally.

Stockholm Transit Agency Launches Open-Loop Fare Payments for Multimodal Rides

NFC TIMES Exclusive Insight – Stockholm Public Transport, or SL, the city-owned company that oversees major public transport in the city, is the latest agency in Europe to launch open-loop fare collection, offering multimodal rides with a tap of a contactless EMV bank card or NFC device.

Case Study: Amsterdam Transit Operator Seeks to Go Nearly 100% Digital for Ticketing to Cut Costs and Enhance Service

NFC TIMES Exclusive Insight – GVB, Amsterdam’s largest public transit operator, says it seeks to replace an aging closed-loop fare card system and go to open-loop and other digital tokens with the planned rollout of its new account-based ticketing system.

Google Announces Plans to Enable Public Transit Ticketing in Maps App along with Rollout of Parking Fare Payments

NFC TIMES Exclusive Insight – Google has announced plans to launch public transit ticketing for more than 80 cities globally in coming weeks from its trip-planning Maps app and also to enable users to buy virtual closed-loop fare cards–starting with the Clipper card in the San Francisco Bay Area–directly from the app. That’s in addition to enabling payments for parking in more than 400 U.S. cities.

UPDATED: U.S. Federal Government Awards Grants to Help Transit Agencies Roll Out Contactless Payments and Mobile Ticketing

Feb 18 2021

NFC TIMES Exclusive Insight – U.S. public transit agencies have been keen to remove cash and paper tickets from their buses and trains and to keep more distance between customers and agency staffers because of the Covid-19 pandemic. Now they are getting a new boost from the U.S. federal government in the form of grant funds to enable them to enhance contactless and mobile payments systems, among other measures.

German Transit Agency Plans to Complete Open-Loop Rollout on Buses and Trains This Quarter, Expand to Other Mobility Later

NFC TIMES Exclusive Insight – German transit agency SWB Bus and Bahn plans to fully roll out its contactless EMV fare payments service BONNsmart to its bus and train lines by the end of the first quarter, after launching a pilot last fall, confirmed a spokesman, who added that plans call for eventually expanding the contactless service to payments for parking and such micromobility modes as e-scooters.