Huawei and YowPay have unveiled what they describe as the world’s first open banking smartwatch point-of-sale (POS) application, marking a significant step forward in wearable payments and pay-by-bank innovation.
The new solution enables merchants to accept payments directly via a smartwatch, eliminating the need for traditional POS terminals or card-based infrastructure. Built on open banking rails, the app allows customers to pay using their existing banking apps, while merchants receive funds instantly into their accounts.
Open banking meets wearable payments
The innovation combines Huawei’s wearable technology ecosystem with YowPay’s open banking and SEPA instant payment capabilities, creating a new form factor for in-person payments.
YowPay’s technology already enables merchants to turn smartphones into payment terminals using QR codes and direct bank transfers. Customers simply scan a QR code with their banking app and approve the payment, with funds transferred instantly and directly to the merchant account without intermediaries handling the funds.
By embedding this functionality into a smartwatch, the companies are extending pay-by-bank payments into wearable devices, allowing merchants to accept transactions anywhere with minimal hardware.
How the smartwatch POS works
The smartwatch POS app functions as a lightweight payment terminal:
- The merchant generates a QR code on the smartwatch screen
- The customer scans it using their mobile banking app
- Payment is authorised via open banking (PIS)
- Funds are transferred instantly via SEPA rails
Because the payment is processed directly between bank accounts, the model reduces reliance on card networks, acquirers, and interchange fees.
This approach aligns with the broader growth of account-to-account (A2A) payments, particularly in Europe, where open banking frameworks are driving adoption of pay-by-bank solutions.
Expanding the role of wearables in commerce
Huawei has been steadily expanding its payments ecosystem through services like Huawei Pay, which allows users to make contactless payments using smartphones and wearables.
However, the partnership with YowPay represents a shift from consumer-side payments (paying with a watch) to merchant-side acceptance (getting paid via a watch) — a less explored but potentially disruptive use case.
The move could open new opportunities for:
- Small merchants and micro-businesses
- Mobile vendors and service providers
- Events, transport, and on-the-go commerce
By removing the need for dedicated POS hardware, smartwatch-based acceptance could lower barriers to entry for digital payments.
Competitive implications for POS and fintech
The launch comes amid increasing competition in the softPOS and tap-to-phone market, where smartphones are already being used as payment terminals. Extending this capability to wearables introduces a new layer of portability and convenience.
At the same time, the use of open banking rails positions the solution as a low-cost alternative to card payments, particularly attractive for merchants seeking to reduce transaction fees.
The development also highlights the convergence of embedded finance, open banking, and IoT devices, as payment functionality becomes integrated into everyday hardware.
“Our goal has always been to make payments as seamless as a heartbeat,” says Christian Caumont, CEO of Yowpay. “By integrating our Open Banking and generally SEPA payments tech into Huawei’s industry-leading wearables, we are giving merchants total mobility and financial sovereignty.”
Outlook for open banking payments
As open banking adoption grows across Europe, solutions like the Huawei–YowPay smartwatch POS could accelerate the shift toward real-time, account-to-account payments in physical retail environments.
While challenges remain, such as user education, merchant onboarding, and standardisation, the launch signals a broader trend: payments are moving beyond traditional terminals and into ubiquitous, connected devices.
If adoption scales, smartwatch POS applications could play a role in reshaping how merchants accept payments, bringing open banking payments closer to mainstream, in-person commerce.
