Buy gas with your fingertip? CEO of Mercedes pay on securing the future of in-car payments

Unless you learned to drive within the past few years, you probably remember digging around in the cupholder for coins to feed the parking meter or hanging out the window to slide cash in the slot of a parking garage payment booth. Recent advances in digital payment technology have made those payments easier. Now you can just tap on the infotainment display in the car to reserve or pay for parking.

Imagine if getting around town was even simpler.

That’s the ethos behind Mercedes pay+, an in-car e-commerce platform that car owners can use to buy Mercedes-Benz products and services. Now Mercedes pay has partnered with Mastercard to make paying from inside your car even more secure. Starting with 3,600 service stations in Germany, customers will be able to use a fingerprint sensor in their car to pay for fuel, eliminating the need to enter a PIN at the pump or authenticate via mobile device. For the first time, in-car payments will be possible at the point of sale — turning your dashboard into a convenient payment device.

The Mastercard Newsroom sat down with Nico Kersten, CEO of Mercedes pay, to talk about the evolution of the payment platform, the challenges his team faced, and what to expect next in in-car payments.

You launched Mercedes pay+ in 2018. How has the acceleration of digitalization, particularly during the pandemic, shaped its evolution?

Kersten: The automotive industry has changed a lot over the past decade. The car itself, the software and the hardware have all risen to a higher level. The same is true for payments. When I started at Mercedes-Benz 20 years ago, no one was even thinking about the car as a payment device. But the automotive industry’s business model is expanding. We’re not just selling and maintaining cars; with our comprehensive Mercedes-Benz ecosystem, we make life easier for our customers. In this we bundle all areas related to the car. Digitalization opens up completely new possibilities. For example, we offer them easier access to everyday services, like charging, parking and fueling through connectivity with third-party providers. With the recent innovations in automotive and fintech, we can take the in-car payment experience to the next level.

What challenges did Mercedes-Benz face in the authentication of payments and other digital devices?

Kersten: Our cars are known for their safety. The same is true with our payments. We ensure that card data, for example, is saved securely, and we comply with all regulations regarding payment authentication. Europe has stringent rules for customer authentication, which protects the customer, but it is not designed to improve customer experience. That was the challenge we needed to overcome, and we worked with Mastercard to make the authentication experience easier. As a result of our collaboration, we can now offer biometric authentication in the car.

We talked about the experience of paying right from your car. How fast do you think drivers will adopt the service of paying digitally from the car in their everyday life?

Kersten: I’m optimistic, because our offerings to the customer are expanding, with cool services that will quickly become part of the customer’s daily life. Last month I was in the Netherlands. I drove into a parking lot and a message popped up on the dashboard screen: “Do you want to pay for parking?” It was that easy. The more you experience that, the more you don’t want to do without it.

Was there a sensor in the parking lot that automatically made that connection?

Kersten: Exactly. As we are in the era of connected vehicles, we know the exact geoposition of the vehicle and can offer local services, like using the on-street parking spot.

Part of the promise of self-driving cars is to turn your vehicle into another space to shop, work, even entertain. How is Mercedes pay innovating for that future?

Kersten: Self-driving vehicles will expand what the driver can do, but even now, in the newest vehicles, all the passengers have a built-in tablet, and we are already helping them watch a movie or play games. As the technology advances, we have a lot of ideas about what drivers and passengers would like to use. We’re working hard to keep giving our customers the most valuable gift: their own time.