The Latest News In Wireless Payments

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I can foresee a world where an actual credit card is a relic akin to rotary phone, but we are not there yet. There are several wireless payment systems that are being developed, but we are a long ways away from a clear standard.

Some use wireless communication between a card and a terminal, while others rely on a smartphone to magically transmit your account information. Here are a couple of the latest developments.

Paying With Sounds

One of the more interesting ideas I have heard in a while is this system where payments are made with sound. Like a dog whistle, this system would use sounds that are out of the range of human hearing. Unlike other systems being developed, this payment method may be backwardly compatible with your existing phone. This system, called Zoosh:

…involves software that utilizes the speaker and microphone in a handset to send and receive audio signals with another device, similar to the way early modems exchange data by sending tones through the handsets of desk phones cradled in coupler devices.

I guess I can see this working, so long as they solve the problem of electronic eavesdropping. On the other hand, I am having trouble seeing how this is easier that swiping a card.

Chip And Pin Gains Steam In The United States

Right now, the most popular wireless payment system is Chip and Pin. This system where you waive your card and provide a PIN is wildly popular throughout most countries not named “America.” The sad result is that American travelers are bewildered when their cards are not accepted in Europe. This happens at the places you would least like to have trouble paying; public transpiration, automated gas pumps, and vending machines. These machines are unattended and the hapless American tourists are left to scratch their heads wondering if machine is broken or if they have merely failed to comprehend the instructions clearly written in Bulgarian.

Slowly, some banks are stepping in to fill the demand for a credit card that will work in these situations. US Bank has become the first major bank to offer a card with Chip And Pin technology.

U.S. Bank is pleased to be the first issuer in the United States to provide dual interface EMV cards that can be conveniently used anywhere  whether it be a chip-card reader with a merchant overseas or a contactless payment terminal or magstripe reader here in the United States, said Cliff Cook, chief marketing officer for U.S. Bank Retail Payment Solutions. While we believe EMV is important for our international travel cardholders, we are committed to driving contactless mobile payments in the United States.

This feature is offered on its otherwise unremarkable FlexPerks card.

Where Are We Going?

It would be nice to have all my credit cards stored in my cell phone’s memory. Every time I use one, it would be able to tell me my current balance on the card and the next payment due date.  I would also like to see some quick details about the credit card rewards offered or the foreign transaction fees levied. In this way, developers could easily build applications that would automatically select the best card for the merchant I am visiting. Ideally, I would pay with the card that has the furthest due date, or the highest rewards.

The alternative is a world where my credit card information is on my phone, but I see few real benefits. I don’t have to carry the cards in my wallet or swipe them, but is that such a big deal?  I am sure I will still have to carry a wallet with ID and other information, so slimming down by a few cards is hardly a revolution. Nevertheless, I will stay on top of these trends and let you know where it is all going every step of the way.

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