Mastercard pushes mobile wallets

 

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Posted on 30 Oct 2008 at 11:17

Mastercard is ready to unveil a new payment card that can be cheaply installed in mobile phones, potentially removing one of the barriers holding back mass adoption of the payment technology.

The technology, dubbed Near Field Communication (NFC), allows consumers to make small payments simply by waving their mobile phone over a wireless reader, similar to how travellers in London access public transport.

"We are talking to serious banks ... and not about trials, but about commercial launches," says James Anderson, vice president of Mastercard's mobile business.

Mastercard's new service could help deal with some of the problems facing the industry, but even then analysts warn the financial industry and telecom operators still need to agree on some kind of revenue split.

"A lot of pieces are yet to be fit in and some of them are out of control of the financial community," says Ed Kountz, analyst at Jupiter Research, adding that lack of availability of wallet-phones was also holding back the market.

Nokia has introduced four products using the technology, and ABI Research has already forecast 6.5 million NFC phones could be sold this year. However growth is being hampered by costs stemming from low volumes and an extra chip needed in phones for data security.

"Lack of handsets is a symptom of a business model problem, not the cause of it. Handset makers are comfortable with the technology and if people are starting to order them the vendors are going to make them," says Mastercard's Anderson.

Author: Reuters