The popular German discount retailer Lidl, which operates in numerous EU states is developing its very own payment system. While much of the details remain unknown as the pilot scheme is currently being tested in Spain, the system will use the existing mobile app Lidl Plus, which is already available in a number of countries including Austria, Germany and Poland.
Once rolled out, Lidl Pay is expected to raise a few eyebrows in the headquarters of companies such as Apple and Google. Both have invested heavily into entering the global and European payment space with their respective products.
Moreover, in Germany, Lidl is hoping to offer an additional upgrade to its new system by allowing for Direct Debit payments. This will make it possible for the company to lower its costs, as it would no longer have to pay transaction fees to the credit card providers.
Another advantage of having a unique payment system rests in Lidl’s ability to collect valuable data on its customers and their shopping patterns. The data can then be used towards optimizing the chain’s operations and in delivering better service to customers. And because the company would generate its own data, it will not have to rely on any third party for storage or processing, cutting its costs further still.
But while on surface it seems that Lidl Pay will bring noticeable benefits to the company, the ultimate litmus test of success will depend on the extent to which Lidl’s own customers will be prepared to embrace it. To that end, Lidl will have to invest time and money into winning the hearts and minds of the increasingly surveillance-weary population.
Date: July 25, 2019