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Credit Card Applications » News » Other » Will iphones double up as credit cards in the future?

Will iphones double up as credit cards in the future?

November 10, 2010
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Expectations are rising as the iPhone5 is scheduled to be launched early January 2011. Techies are an excited lot with the latest news that is doing the rounds, as Apple might add the 'Near Field Communication' or (NFC) card reading technology, in its next generation of iPhones. If this comes into force the users of the iPhone5 might have to just wave & pay (with their mobile devices) during their checkout.

This news has been around for quite a while now and the card giants such as MasterCard and Visa had invested huge sums and experimented for at least more than a year with this new technology. Discover Financial Services in association with Barclays, Verizon, AT&T, and T-Mobile would be developing a technology where smart phones could be used to make purchases instead of the cards.

Japan and Korea have already managed to introduce this new technology of paying with their mobile devices, whereas it is still in the initial stages in the U.S. These mobile devices that are being used in Japan as well as Korea are already equipped with a microchip which helps mobile users to make payments for everything including movie tickets to purchases made at grocery stores, or a meal at a restaurant. The U.K. is not lagging behind, as mobile devices would be equipped with special SIM cards in order to enable users to pay with their mobile phones. This is expected to be operational before the London Olympics which is to be held in 2012.

The NFC technology is supposed to be the main technology in the iPhone5, which uses the 'short-range wireless communication' systems to transmit the data from the mobile devices to the 'point-of-sale devices'. The wave & pay would help save time instead of the cumbersome card swipe & sign.

If this technology catches on, then cell phones would turn into virtual wallets making the plastic money as well as cash sound obsolete. The mobile payment modes are expected to be 'game changers' as per the card giants. If this comes into force, it would virtually mean a cashless society where everything from different cards, money, coupons, as well as a driver's license would be replaced.

This technology could be used to gain access to coupons, discounts, or even get a weather report when required.

However, banks that do not have access to a mobile network will find this move towards the new technology a bit challenging as wireless carriers would be able to make the switch much faster.

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