UBS isn't going to give in to the might of Apple in the battle for electronic payment systems. Andreas Kubli, the head of digitization, explains why the bank is favoring the Swiss solution, Twint.

Starting in January, two digital payment solutions will be available in Switzerland, hoping to catch the lions' share of transactions in a market with some 8 million people.

The Swiss solution has the support of the biggest banks, UBS, Credit Suisse, Raiffeisen, Zuercher Kantonalbank (ZKB) and Postfinance, as well as the two biggest retailers Migros and Coop, telecommunications giant Swisscom and SIX, the stock exchange operator. They recently combined to back up Twint, the electronic payment application.

No Need for Apple Pay

Twint is facing competition mainly from Cupertino, where IT company Apple is based. The U.S. electronics giant in July launched its digital wallet Apple Pay in Switzerland and has gained the backing of Valora, the kiosk operator, Cornèr Bank as well as credit card firms Visa, Mastercard and Swiss Bankers.

The fight promises to become gripping, not least as UBS, the country's largest financial-services company, has decided to give it a real go. The man behind the push is Andreas Kubli, the bank's head of multichannel management and digitization.

Twint Has What We Need

«UBS currently doesn't see the need to provide Apple Pay in Switzerland,» he told finews.ch in an interview. Twint has it all that is required for contact-free payments and provides the biggest added value to consumers, Kubli said.

Twint, the company that was formed through a merger of Twint (Postfinance and some banks) and Paymit (UBS, SIX, ZKB and Raiffeisen) has received the green light from the competition commission in Switzerland last week and is now set to go on the offensive.

P2P and Loyalty Cards

«Payments aren't going to be restricted to retailers, but are also planned for traders without terminals and in online shopping,» Kubli announced. He also envisages transactions between private citizens (P2P) and the inclusion of customer loyalty cards.

To further make Twint consumer friendly, Twint plans to directly connect to their bank accounts, instead of requiring the bypass of a credit card.

Will It Suffice?

It is obviously far from obvious whether this all will suffice to stand up to Apple Pay in the long term. Twint already has some 500,000 users, but Apple is an international solution with awesome technological firepower to back it up.

Thanks to the NFC technology, Apple Pay is able to link up with most payment terminals at Swiss retailers. Bluetooth, the technology of choice of Twint, isn't yet widely used by retailers and Apple has restricted the NFC channel on its iPhones for external providers – iPhones are widely used in Switzerland.

Switzerland's banking community isn't united either – recently Graubuendner Kantonalbank decided to offer Apple Pay in addition to Twint, and further companies may follow suit. Graubuendner Kantonalbank incidentally operates in the region of St. Moritz, where the tourist industry is of paramount importance.