Wireless carriers using contactless payment technology for Smartphone credit card processing could give credit card corporations a worthy competitor. A proprietary mobile payments system being developed by AT and T, Verizon and T-Mobile that lets people spend by waving their Smartphone past a scanner could compete directly with MasterCard and Visa. After fighting with credit card businesses for years over excessive swipe fees, retailers are viewing the new competition within the payments market with satisfaction.
Smartphone charge card processing an emerging trend
A payment service network to supplant credit and debit cards with Smartphone’s will begin with a test technique in Atlanta and 3 other Americas cities. The service, Bloomberg reports, is modeled after payments networks in Japan, Turkey and the U.K. that use contactless technology. One business analyst told Bloomberg the AT and T/Verizon/T-Mobile Smartphone bank card venture was a “game changer” since the wireless carriers are the biggest recurring billers in each and every market and are experts at processing payments. Discover, the fourth largest credit card company after Visa, MasterCard and American Express, is handling processing for the new payment service network.
Contactless payments must clear hurdles
More than 60 percent of Smartphone’s have contactless payment functions in Japan. If they become popular within the Americas Smartphone charge cards will draw increased attention from malicious hackers. And consumers will need the exact same protection for their Smartphone’s that they have against unauthorized purchases with lost or stolen bank cards.
Carriers and card companies compete for billions in mobile payment profits
In their pursuit of mobile payment profits, the wireless carriers aren’t alone. ChannelWeb reports that credit card corporations and numerous tech firms have accelerated mobile payment programs as the Smartphone industry goes ballistic. The carriers think they have an edge with their background in payment processing. But it remains to be seen if processing payments for their customers will translate to servicing merchant accounts directly as a payment service network for the carriers, Joe Bardwell, an executive at a California wireless tech firm, told ChannelWeb. Plus, consumers that already do not care for the wireless carriers’ billing practices may not trust them to manage bank card payments.
Retailers welcome payments market competition
One more payment service network could take off with retailers, especially after they have fought with bank card businesses for years over transaction fees. To emphasize that fact, Bloomberg cites an effort by retailers last month to gain caps on swipe fees from Congress, as well as a 2005 federal anti-trust lawsuit that remains pending . A spokesman for the Retail Industry Leaders Association told Bloomberg that a secure and reliable competing network that gives consumers mobility payment opportunities and reduces retailers’ costs would be welcome.
Discover more details on this subject
Bloomberg
bloomberg.com/news/2010-08-02/at-t-verizon-said-to-target-visa-mastercard-with-smartphones.html
Tech News World
technewsworld.com/story/70546.html”
Channel Web
crn.com/mobile/226500140″>
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