AT&T, Verizon and T-Mobile are teaming up to compete with credit card companies by allowing customers to pay for products by waving their smart phones, according to a Bloomberg report.
T-mobile, AT&T and Verizon are providing services to customer to pay through their mart phones offering completion to credit card companies as per a report from Bloomberg.
Wireless customers can now place their phone in front of a wireless reader than have to swipe their credit cards. This technology would most probably have a unique tag with radio frequency identification in the phone that is linked to the customer account.
The report did not contain specifications about how this system would be working but for years there have been talks of such a system coming about in the United States. Mobile payment systems are already being used in Southeast Asia and Scandinavian countries and Third world Countries also have wireless transfers of mobile credit between phones instead of currency.
Master Card which is a fortune 500 company along with Visa have tried to bring out a version of mobile technology using RFID for the customers along with stickers and key chain swipe passes which will be stuck to the mobile phones. There would be additional benefits for consumers according to telecom analysts once this process is streamlined.
Master and Visa have not yet had the attempts integrated into all the mobile devices according to Dan Hayes a partner with a consulting firm.
Once the RFID tags in the phones are connected to the electronic components of the phone there can be multiple accounts liked to the device and consumers have a wider choice on which one can be used for payments. This avenue of payment is also safer than a credit card as phones can have additional passwords for doing the payments and the RFID tag can be shut down in case the phone is lost or misplaced by the consumers.
If this payment technology grows popular telecom firms would begin a whole new line of business which would be in banking. Retailers are unhappy with the way things are and how the interchange fees is costing them a lot of their business earnings. The wireless companies` methods to charge retailers are yet to be clarified but credit card competitors would be a welcome change especially for small business enterprises.
This opportunity could mean a lot of revenue for firms like Verizon and AT&T wherein wireless operators would take over the roles of credit card companies. Discover and Barclays may be the new partners who would offer such link ups to the mobile companies.