AT&T Inc., Verizon Wireless and T-Mobile USA are reportedly teaming up to launch a contactless mobile payment pilot in Atlanta and three other cities, according to bloomberg.com.
Bloomberg calls the venture, which is expected to include the support of Discover Financial Services and Barclays Plc, a “threat” to Visa and MasterCard, the world’s largest payment networks.
If the system works, smart phones could replace some 1 billion payment cards in use in the U.S, which account for nearly half of all consumer purchases.
Richard Crone of California-based Crone Consulting LLC calls the move “a game changer,” and points out that mobile carriers are the biggest recurring billers in every market, making them experts at processing payments.
Additionally, retailers who are sick of dealing with ever-escalating swipe fees from Visa and MasterCard may be eager to give the new system shot, says Bloomberg.
Meanwhile, MasterCard and Visa have been employing their own mobile solutions. In June, MasterCard teamed up with Citigroup to produce contactless PayPass stickers that can be affixed to mobile phones. Visa and DeviceFidelity also developed their own solution earlier this year that works with existing smart phones, including Apple’s iPhone.
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