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Wednesday, February 23, 2005
Cell Phones As Credit Cards
ABI Research says, the number of opportunities to use your cell phone and other small objects to make payments will grow rapidly this year and will keep growing in future years. Often called "contactless payments," the technology involves swiping an enabled cell phone, key ring or other small item near a point-of-sale terminal. The capabilities, which use RFID-like near-field wireless technology, are starting to gain momentum in Japan and are undergoing tests in the U.S. and Europe. Credit card companies have endorsed the technology. As consumers continue to use card-based transactions for smaller, traditionally cash-based purchases, "contactless payment capabilities make more sense, especially for card issuers looking to increase customer loyalty and convenience," Erik Michielsen, ABI's director of RFID and ubiquitous wireless research, said in a statement. While the technology has been around for a while and used in a small number of cases such as ExxonMobile's SpeedPass payment system, it will start to catch on big-time this year, Michielsen said. That's because those previous efforts didn't have the support of credit card vendors.
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