7-Eleven Japan Kills 7pay QR

After the rocky start and security meltdown of 7-Eleven’s 7pay QR Code payment service launch on July 1, the service suffered from an endless parade of mishaps and mistakes, such as forcibly migrating nanaco accounts to 7pay without telling users, and a very recent and rocky password reset. Public and media perception of the service had dropped to the point where 7pay was better off dead, which 7-Eleven announced today. 7pay is dead as of September 30.

As I said before:

the low bar QR Code entry point only resulted in incompetent players setting up payments systems. The resulting mess and confusion ends up destroying the very cashless migration momentum the industry worked hard to create.

The incompetent players here were 7-Eleven entrusting 7pay development to a new unproven company group instead of leveraging the seasoned in-house management experience, and solid service record, of their own nanaco prepaid card.

I knew something was terribly wrong from July 2 at a local 7-Eleven, one of the best family run 7-Eleven stores in Japan with several service quality rewards from HQ. The owners son spent 10 minutes patiently explaining to a woman customer how to get the free 7pay sign-up onigiri she wanted. It was clear that the startup campaign details and the migration of nanaco points were poorly done and confusing to everyone.

Despite the western media spin of portraying the 7pay meltdown as a symptom of a larger Japanese incompetence migrating to a cashless society, this is simply the incompetence of a single company who wanted to cash in on the QR Code fad, who thought they could fast track creating a new payment service without focused thinking or doing the required work of building a great product.

The final score: 808 customers scammed for ¥3,8615,473 worth of stuff, all victims and 7pay account balances to be refunded in full, the reputation of QR Code payments in tatters.

Good riddance.

Previous 7pay coverage:
Another QR Code Payment Launch, Another Security Meltdown July 3
The QR Code Tipping Point July 4
QR Codes and Big Data July 5

Junya Suzuki has posted a post mortem analysis, if you value security and still use the 7iD app, or the Omni7 site, which will continue operations, be aware that in Suzuki san’s opinion these still carry a security risk. Seven & i Holdings has not come clean. Until they present a comprehensive security overhaul, be careful using those services.