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Target, banks push to improve Web-based payments

A new World Wide Web Consortium group tackles issues like authentication and digital wallets. The eventual result could be electronic payments not so dominated by particular companies.

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The familiar mechanisms for buying items on the Web -- shopping carts, usernames, credit card numbers -- has become familiar over the years. But a handful of companies and organizations have come together for a fresh look at the process.

They include retail giant Target, Russian search and email provider Yandex, payment and authentication tech specialist Gemalto, Netherlands-based banking giant Rabobank and the Federal Reserve Bank of Minneapolis. They've begun tackling the issue at the World Wide Web Consortium (W3C) through a group launched Wednesday called the Web Payments Interest Group.

It's not clear exactly what kind of standards might eventually result from the work. One possibility would be the ability to let a Web app on a mobile phone make a payment when a person taps it against a wireless pay station.

According to the group's charter, one big area the group will address is digital wallets -- the technology that lets you replace physical items like cash, credit cards and debit cards with electronic equivalents. One prime example is Apple Pay, which will work on Apple's new iPhone 6 and 6 Plus smartphones after its possible launch this month.

The W3C group, though, hopes to tackle the technology in a standardized way that lets anyone participate, not just those within a particular alliance. That will require a look at authentication, security, virtual currencies such as Bitcoin, near-field communications (NFC) technology used in tap-to-pay systems, and more.

Because online payment technology is maturing with smartphones that people carry all the time and that can be used for identity authentication, the payments issue has become strategic for the Web. Today, the Web is a great way to reach people on a multitude of devices -- PCs, smartphones, tablets, and gaming consoles, for example. But many developers are concentrating instead on apps for mobile devices at the expense of Web programming.

The appeal of the Web persists, though. Web apps for payments ideally won't be so tied down to particular smartphone maker, app store, bank, or credit card payment processor. With Apple Pay and other mobile alternatives well under way, though, the W3C members will need to work hard to be relevant.