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Visa and Google Team Up on Mobile Payments

Posted by: Spencer Ante on September 25, 2008

Mobile commerce was one of the most over-hyped trends during the dot com boom. And it still has yet to gain any significant traction in the U.S.—despite a surge in wireless innovation over the last few years.

But the ability to transact business on your cell phone got a major boost today with the announcement that Visa has partnered with Google to create a new mobile payments service. The plan, unveiled at a press conference at the Mandarin Oriental Hotel in New York, involves the launch of a set of applications for Android, the mobile operating system created by Internet advertising giant Google.

The services will allow consumers to receive notifications about transactions on their bank accounts and obtain promotional offers from merchants. The service would also work with Google’s map program, pointing consumers to nearby stores where they can redeem the offers.

In addition, Visa said it is developing a payment service that will enable consumers to make mobile payments on the go, like a credit card, or over wireless networks. For the first few months, that application will only be available to Android phone users who also have Visa cards issued by JPMorgan Chase.

Along with Google, Visa also announced a deal with Nokia, the biggest cell phone maker, to deliver the payment and commerce services for a number of Nokia handsets, beginning with the 6212 phone.

Tim Attinger, Visa’s global head of product development, said the company is in talks to strike similar deaks with all of the U.S. phone operators and other handset makers, including Apple. “This is the first step in a plan to get on as many platforms as we can,” says Attinger. (See update below.)

The services could take years to catch on because the phone companies need to approve the applications, and stores would need to install new card readers to support some of the services.

That’s one big reason why Visa chose to partner with Google. Handset makers and phone operators that back Android will automatically make the Visa application available through the Android application store.

Earlier this week, Google rolled out the first Android-based handset to great fanfare: the G1, a handset made by HTC and sold through T-Mobile. But Visa said the G1 does not yet include the chips and other technology to support mobile payments.

Clearly, turning the cell phone into a credit-card-like device is a complicated process involving many stakeholders that is going to take time. But a partnership bewteen three major players like Visa, Google and Nokia shows that this pipe dream is finally starting to become a reality.

UPDATE: Visa now says that it has not yet entered into talks with Apple. But it plans to approach the company in the near future.

Reader Comments


September 28, 2008 10:24 AM

ithought it was already possible to use a visa card topay using mobile

Ray Anderson

September 29, 2008 10:56 AM

Yes, it is.

Bango ( launched such a service - with global coverage - back in 2003, to complement its carrier billing based service that also operates world-wide.

The Bango approach is web based - this seems more like the initiative launched with Nokia

1999: "Nokia announces mobile payments alliance with Visa"
2001: "Visa announces mobile payments alliance with Nokia"
2003: "Nokia and Visa EU announces collaboration in mobile payments"
2005: "Nokia announces NFC payments with Visa"
2006: "Visa, Nokia launch phone payment project"


September 29, 2008 1:12 PM

I don't understand how it works? Can someone explain how is it suppose to work?


John Loschky

October 1, 2008 7:04 PM

There are many solutions, but most require integration with a web account (refer to Bango). Billing Revolution recently announced the launch of our single click credit card solution for digital/physical goods. There is no web account required and you only enter your cc information once. All future transactions are single click enabled, thus eliminating the conversion issues of previous solutions.

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Bloomberg Businessweek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, and Douglas MacMillan, dig behind the headlines to analyze what’s really happening throughout the world of technology. Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.



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