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You are here: Cell Phone Reviews > Mobile Commerce - Pay Using Your Cell Phone: Fact or Fiction?
Mobile Commerce - Pay Using Your Cell Phone: Fact or Fiction?
You may have heard that in Europe and especially Asia people are able to pay for groceries or tickets using their cell phones. You may be wondering if this is actually a reality or just wishful thinking. We would like to present what is cooking on mobile commerce in the United States and if it may be something we may all use down the line. Let's start from the first question: fact or fiction? Fact is there are half a dozen companies in the U.S. offering mobile payment technology to their users. The fictional part is that they are all in their infancy and it may take a few more months to see how well they work and how consumers will accept the concept.
What kind of payment technologies are out there? There are mainly two: SMS payments and Near Field Communication (NFC). SMS or Texting allows for the transaction by typing the dollar amount onto your cell phone and sending it to the person/company. NFC lets you swipe your phone like a credit card near a receiving terminal and even allows for cell phone to cell phone transactions.
While NFC is still in its development, only Asian carriers have started using it, SMS transactions are becoming a reality in the United States already. We have found the following companies with this capabilities already and the list will grow as consumers will adopt this technology:
TextPayMe: Simply allows you to send and receive money by using text messaging. It's currently advertised to pay friends back for movie tickets, split restaurant bills and even purchases from Craiglist. There is no software to install. All you need is a text messaging enabled phone. You simply write a text message on your phone to sms@textpayme.com as in the format provided below:
"pay 25 2125551122" where 25 stands for $25.00.
After you send the message, you receive an automated phone call from textpayme asking you for your PIN #. (Feel free to lose your phone, then; you are still protected). You need to open up an account first in order to deposit money, either by wire transfer or check.
Obopay: The model is similar to a debit card. You deposit money at Obopay, by creating an account first. Then you can use your mobile phone to make or even receive a payment. Each account is protected by a unique PIN code. After the account set up is completed, you need to dowload onto your cellular phone the Obopay mobile application (which currently requires a Java 2 enabled cell phone). Now a customer can make any transaction to any SMS enabled cell phone. If the receiving person does not have Obopay service, they will still receive the instant message confirming the transaction, but they would need to download the same application to collect the funds. It may seem like a lot of work, but this is no different than adopting any other payment methods, like we all did with Paypal. You can even collect money by using an Obopay companion debit card. The card is provided at set-up.
Other Companies we have been observing include: M-Enable, which allows merchants to charge their customers by SMS or a WAP enabled phone; Mytango which allows for text messaging transactions with selected list of merchants (California only for now); BillmyCell, which allows for payments by calling an 800# from your cell phone to pay for cab rides or tickets.
We all know how cellphones are becoming the "don't leave home without it" gadget. I myself may forget my wallet, but hardly ever my phone. If mobile commerce will take off, maybe someday I'll be fine with just my phone.
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