Visa, Nokia turn cell phones into credit cards
Credit card giant launches global system to turn mobile phones into wallets in a deal with the world's top handset maker.
Consumers will be able to pay for groceries and other purchases by swiping a phone over a reader that electronically communicates with a microchip on the phone. Phone owners confirm the purchase with the push of a button and the deal is complete.
The platform is the result of many years of trials worldwide and will enable contact-free payments, remote payments, person-to-person payments, and mobile coupons.
Consumers will also be able manage their accounts and funds from their mobile devices, Visa announced Tuesday at the Consumer Electronics Show in Las Vegas. IBM helped create the mobile payment system.
The wireless standard that will link mobile phones with payment systems in stores and elsewhere will be the near field communication (NFC) chip, which will be hidden under the phone cover and makes contact when swiped over a reader.
NFC technology, developed by former Philips chip unit NXP and Sony, is already widely used in public transport access cards.
Visa, which is the world's biggest credit card payment system, said its cards and payment systems currently generate more than $4 trillion in sales volume globally each year. In October, Visa announced plans to restructure its global operations and create a new publicly traded company called Visa Inc.
The initial version of the mobile payment platform, which launched on Monday, offers contactless mobile payment, personalization over mobile telephony networks, coupons and direct marketing. Subsequent versions of the platform, to be made available later in the year, will include remote payment--also using mobile telephony networks--and person-to-person payment.
Until now, mobile payment systems have been restricted to trials.
In October, Japan's leading credit card company, JCB, started Europe's first mobile phone credit payment trial with Nokia and Dutch telecom operator KPN in seven stores in the Netherlands and among 100 card holders. Other mobile phone payment trials in Germany and Finland have enabled consumers to pay for public transport.