- Wireless Payment by handheld devices like
Palm - beam Palm to a credit card terminal using infra red now and
Bluetooth in future. The POS credit card terminal has an infra red device
attached to it.
- Cashless payment without using conventional
- Mobile wallet initiatives
The Requirement ...
To provide a comprehensive infrastructure (software for the retailer
processing a transaction, consumer software for handheld device, backend
payment and account reconciliation application infrastructure at a
centralized processing center - akin to credit card processing by Visa or
Master Card, the security mechanism, etc) so that an end-to-end transaction
can take place between a consumer and card or wallet holding organization.
Factors & Issues in Web-based Mobile Payment
- Lack of standards
- End-to-end security issue
- Retailer-processing center integration problems -
too many variables in OSes.
- High transaction processing capacity at the backend
application processors - see Visa's initiative to use Sun Solaris
that is claimed to handle 10,000 transactions per second
- Lack of payment infrastructure
Major Vendors Initiatives
- Palm and Visa Partnership - Palm
Inc. has started an initiative with Visa to allow
consumers to use Palm devices to beam credit card information to POS
terminals through an Infra Red (IR) connection. While this is an
early stage trial and pilot, it is significant to see two major players
involved in getting users to modify their individual payment methods.
- Visa International has rolled out a
high-transaction payment infrastructure (consisting of Cisco networking
gear and Sun Solaris J2EE processors) for online transactions. This is
expected to be enhanced to allow mobile commerce. For more info, see
Information week story www.informationweek.com/796/payments
- City Group made a deal with AOL- this will allow
AOL subscribers transfer funds and make payments for web purchases
- Cybercash is
an online payment processor - charges 15 cents/transaction , plus set up
fee of $99 for existing and $499 for new customers (mid 2000 pricing)
- SNAZ Mobile Wallet
related but not exactly a payment system. It facilitates payment
for buying online multiple items from different merchants.
- Person to person payment systems - see www.propay.com
- This allows any two people exchange money anywhere and at
anytime. Since this is a paradigm shift to replace hard cash with
electronic cash without the Federal Banking system of each country or a
credit card institution like Visa or master card, it may find consumer resistance.
- For three months, Macdonald hamburger chain has been testing a new wireless
payment technology in nine restaurants in Chicago and four in California.
Working with Exxon Mobil, McDonald’s is enabling its customers to use
their Mobil Speedpass transponders to swipe pass special cash registers to
pay for their meals. For
more, go here.
- VeriSign has agreed to supply new trust engines to be embedded in
wireless communication devices of DoCoMo’s i-mode 3G services. For
more, go to the news page.
See the above list.
Business Case Justification - Pretty
good as compared to a transaction where the retail clerk swipes the credit
MobileInfo Advisory and Comments:
This is a complex area of software application integration between
payment processing centers, retailers. and consumers. Wireless must be
treated as an add-on to this and stand-alone payment solutions will not
survive for long.