Monday, January 10, 2005

Will That Be Cash or Cell?

I have been saying all along, I wouldn't be surprised to see a service provider buy a credit card like company. It would make a perfict fit. Impulse buying and another way to generate revenues (interest on credit card debt).

From the NY Times Momentum is gaining for cellphones as credit cards.

People already use their cellphones to read e-mail messages, take pictures and play video games. Before long, they may use them in place of their wallets.

By embedding in the cellphone a computer chip or other type of memory device, a phone can double as a credit card. The chip performs the same function as the magnetic strip on the back of a credit card, storing account information and other data necessary to make a purchase.

In Asia, phone makers are already selling phones that users can swipe against credit or debit card readers, in much the same way they would swipe plastic MasterCard or Visa cards. Trials are now under way to bring the technology to America, industry executives said.

Advocates say that consumers will readily embrace the technology as a way to pay for even small purchases, because it is less bother than taking a credit card out of a purse or parting with cash.

The impending changes to the cellphone happen to coincide with major shifts taking place in the banking industry. Since credit cards are still considered somewhat inconvenient, particularly for quick, small purchases, major credit card companies have developed "contactless payment" technologies for checkout counters that allow customers to wave their cards near an electronic reader without having to swipe the card or sign their name.

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