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Mobile Carriers Plan to Revolutionize Payments with Contactless Tech

Strategic Insights

— 1 min read

The National Association of Convenience Stores has released information indicating that Verizon Wireless, T-Mobile USA, and ATandT Inc. are planning to replace credit and debit cards with smartphone contactless payment technology. This largest effort to date is set to be tested in Atlanta and three other cities in the United States. The test involves consumers purchasing merchandise by waving a smartphone in front of a contactless payment device. The mobile carriers' collaboration aims to provide a secure and reliable competing network to traditional payment systems, which are criticized for high transaction fees.

Key Takeaways:

  • Verizon Wireless, T-Mobile USA, and ATandT Inc. are planning to replace credit and debit cards with smartphone contactless payment technology.
  • The test will be carried out in Atlanta and three other cities in the United States.
  • Payments will go through Discover's network, with Barclays helping to manage the accounts.
  • Merchants could be key to the adoption of contactless payment, as they face high transaction fees for credit card transactions.
  • The collaboration aims to provide a secure and reliable competing network to traditional payment systems, which are criticized for high transaction fees.
  • Industry consultant Richard Crone describes the initiative as a "game-changer," citing the fact that the mobile carriers are experts at processing payments.
  • Gary Townsend, CEO of Hill-Townsend Capital LLC, suggests that there is no reason why mobile carriers cannot be allowed to offer financial services, just as they offer other services.
  • The emergence of a secure and reliable competing network could be welcomed by retailers, who are critical of the high costs associated with traditional payment systems.

Statistics:

  • The test of contactless payment technology will be carried out in four cities in the United States.
  • Payments will go through Discover's network.
  • Barclays will help to manage the accounts.
  • Merchants pay high transaction fees for credit card transactions, which provides an incentive for the adoption of contactless payment.

Sources:

  • Bloomberg News
  • National Association of Convenience Stores
  • Crone Consulting LLC
  • Hill-Townsend Capital LLC
  • Retail Industry Leaders Association

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