Using The Mobile Phone As Your Wallet!

The bewildered look on the shop keeper’s face when a customer hands him his mobile phone instead of a credit card, shows that the shop owner is not keeping up with the latest technology.

The new technology takes advantage of the fact that mobile phones are every person’s constant companion and people may forget their wallets at home but not their phones.

When shopping in malls, instead of trudging along several credit or debit cards, shoppers can just swipe their mobile phones. It is now also possible to pay bills through mobiles, including credit card bills, phone bills, electricity bills and other utility bills.

Mobiles phones are doubling up as wallets or credit cards, apart from doing their regular job of being a communication medium. Such phones will either have an embedded number or a bar code to ensure security of transactions. Since mobile phones are given the capability to do a lot of banking transactions, such as checking the bank balance and viewing mini statements or even ordering check books and transferring funds, the security aspect becomes crucial.

Researchers are currently in the process of conducting a trial in London, where hundreds of people are given special handsets that are fitted with built-in credit card and Oyster card, the device used to pay for bus and train tickets. When the phone is passed over a scanner in shops or stations, money is deducted from their bank accounts towards payments. People can also buy things from select cafes and shops using their handsets.

This kind of wireless transactions are a common sight in Japan, where people pay for everything from burgers to train tickets with their mobiles. In South Korea, people make movie reservations through the internet or a fixed line and when entering the theater, they just have to pass their mobile over a radiofrequency reader. They receive an instant SMS that gives them their seat numbers.

Service providers are initiating a global pilot project to offer mobile phones embedded with a credit card chip. Using Radio Frequency Identification technology, the phones will take the place of a debit or credit cards. These mobiles can then be swiped through a NFC terminal (near field communications) at the shops and wherever this technology is incorporated. Service providers are also looking into the prospect of enabling international credit or debit card transactions on mobiles.

Currently, banking regulations specify that the operators tie up with credit card companies.

Many service providers and mobile manufacturers are tying up to provide additional security for mobile phones, taking into consideration that they will now also be used to do money transactions.

Mobile phones are performing the task of a storage device for emails, important data, documents, PIN numbers and passwords. Nokia and Samsung phones already have in-built tracking facilities; such as when a new SIM is inserted in a stolen mobile phone, a message is sent to the original user along with the new number. The original owner can also access the contact list or the inbox of the new user and send him an SMS, alerting him to return the phone or whatever it is they wish to say.

Mobiles phones have transformed from being communication devices to becoming full-fledged wallets. Analysts believe that this technology will experience mass appeal and acceptance only when the service providers and financial institutions work in collaboration and ensure safety and security.

Time to ditch your wallet and use your electronic purse instead, when you go shopping for groceries, buy clothes, buy a drink, rent a video or even when you go to the theatre.