New Way to Pay
Looking for a way to offer customers greater payment convenience? A mobile platform recently introduced by Visa is paving the way for merchants to accept payments from cell phones--though the technology has yet to reach the States.
"It will operate exactly as if the customer reached into his or her wallet and used a credit card," explains Dave Wentker, vice president of mobile innovation for Visa International, who notes that through a trial program from Visa and SK Telecom, customers in South Korea are already paying for products with their cell phones. "Phones with the capability are already in customers' hands; they simply opt to add a Visa payment service, and they can use the phone in a store in lieu of a card."
Visa hopes to see the platform serve as a building block for similar mobile payment products in the U.S. And cell phone makers are already responding to the mobile market potential. Kyocera Wireless recently demonstrated prototype handsets and devices that enable mobile phone users to make purchases with their phones and have the funds debited from a prepaid account or charged to a credit card.
How far are we from a world where such transactions are commonplace? "If we're talking about ordering a movie ticket and paying for it by keying a code into your phone, that's achievable today," says Wentker. "But the time to market for contactless payment at point of sale--where your phone can actually replace your credit card--will depend on banks, mobile operators and consumer readiness." So stay tuned.
Jennifer Pellet is a freelance writer specializing in business and finance.