Smart-phones make our lives easier in so many ways. They help us stay connected to family, friends and jobs. They store pictures, music and videos for or personal edification. They give us entertaining games when we are bored and access to the internet when we need information. They pay our bills for us when we are at a coffee shop or restaurant.
Wait.... what was that last one? Yes, you read that right. In many neighborhoods across the globe there are places where your smart-phone becomes a magic wand that you wave in front of a machine to pay for your latte or sandwich. Furthermore, if the many start-up companies that are rolling out this 'not-really new' technology have anything to say about it, it will eventually be in your neighborhood too.
The technology is called near-field communication, or NFC. It is an advanced form of RFID (radio frequency identification), and earlier in November Google demonstrated an Android phone with this technology inside. The NFC chip stores your credit card information and transfers it to the payment processing machine, making the credit and debit cards in your wallet a thing of the past. With this tech, you don't need to sign for anything or even wait for a receipt, because the communication runs two-way. Just before you head out the door a digital receipt is sent back to your phone. If you would like to read more detail about the technology you can check it out here at Howstuffworks.com.
Interestingly, there are some retailers that have been using a form of this concept without the technology of the NFC yet. According to this article from PCWorld.com, there is a company called MobileLime in Boston that allows you to sign up for their service online and link your banking information to your cell phone number. Then at any of the participating retailers in the Boston you can simply phone in your payment before you leave the establishment. According to the same article there is a similar start-up company in Carlsbad, California, called BlackLab Mobile trying out the same thing. Also, in Coral Gables, Florida you can use the same concept to pay for your downtown parking meter payment and even extend its time.
Digging a little deeper we find that, according to Mobilemarketer.com, MasterCard has been experimenting with the technology since 2008! Their mobile wallet service called PayPass, quietly rolled out to test markets in Dallas, TX and is slowly spreading around the country.
Furthermore, according to this article at FoxNews.com, “AT&T, Verizon Wirelesss and T-Mobile recently announced a joint venture called Isis to build a mobile payment network based on an NFC system. The first markets should go live within a year and a half. And Nokia and Google have indicated their new 2011 phones will be compatible with it.”
It seems that our smart-phones may just be poised to eliminate the need for our wallets fairly soon. I've always liked the idea of a cashless society, but it does pose some interesting problems as well. What happens when digital thieves figure out a way to crack the security? Also, for some people, having unfettered access to their bank account at any moment might cause them to overspend their budgets.
Still, it's pretty amazing how an idea born from the 1960's 'Star Trek' is reshaping the world. So what do you guys think? Do you like the idea of your cell phone becoming your wallet? Is it an unstoppably cool idea or a scary technology-train-wreck waiting to happen? Sound off with your perspective in the forums.