According to Duthie, in every case where open platforms have outperformed closed systems, it is their very openness that has allowed them to rapidly scale functionality, and thus value, for end users. His argument centres on one key component that contributes to this success вЂ“ scale. James Duthie of DT makes a fairly compelling argument for open loop solutions, citing the historical success that open systems have had.

Closed Loop Mobile Payments: Advantages and Disadvantages Open Loop вЂ“ Advantages These solutions allow customers to pay via their mobile devices only at a specific vendor and only against an established account balance (many of these solutions offer automatic account top-up options). Customers can check their balances, add money, and pay using a mobile application rather than a physical card.Д«randed mobile payment/loyalty solutions are closed loop mobile payment systems, for example, the TimmyMe application for Tim Hortons or the Starbucks mobile app. In a general sense, closed loop mobile payments are those that enable consumers to load money into a spending account that is linked to a payment device вЂ“ for example, a gift card for a specific company.Д¬losed loop mobile payment solutions enable customers to manage their gift card or payment account via their mobile devices. An easier way to understand it is to think of closed payments as a gift card and open payments as a credit card. Unlike their closed counterparts, open platforms are connected to a personal account вЂ“ a credit card for example вЂ“ and donвЂ™t require a prepaid amount to exist in the system that needs to be topped up when the money runs out. Open loop mobile payment solutions allow users to pay at many different locations from one centralized digital wallet. closed loop mobile payments solutions.Д«efore we dive deeper into the advantages and disadvantages of these respective options, weвЂ™re going to define what exactly is meant by вЂњopen loopвЂќ and вЂњclosed loopвЂќ in the mobile payments context. Except in this context, it is a matter of open vs. In the hotly contested mobile payments space, once again we are seeing this debate manifest. It seems that for any major tech development, both open systems and closed systems are in play and in opposition.

Loop mobile online payment