U.S. wireless carriers to challenge Visa and Mastercard

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Soon, wallets and phones may merge - for those fortunate enough to carry a top-of-the-line smartphone, in any case. The three big U.S. wireless providers - Verizon Wireless ( VZ ), AT&T ( T ) and T-Mobile - are reported to be working together with Discover Financial Services ( DFS ) and Barclays PLC ( BCS ) to create a mobile, smartphone-based alternative to the credit card.

Using radio-frequency identification ( RFID ) chips, like those in some new credit cards , the traditional swipe would be replaced by simply waving the phone across a scanner. That would require new equipment for both retailers and phones.

The International Business Times pegged the cost of the new technology at $200 per reader and $15 per updated device.

Similar systems already exist around the world, in places as varied as Turkey, the U.K. and mobile phone-crazy Japan. By partnering with Discover, the wireless firms could do an end run of sorts around Visa ( V ) and Mastercard ( MA ), which are far and away the market-leaders in electronic payments.

The new systems could usher in a wave of new business opportunities for cell-phone makers and software providers like Apple ( AAPL ), Google ( GOOG ) and Research in Motion ( RIMM ).Turning phones into mobile payment systems will unlock a new wave of potential apps and incentive programs. ADNFCR-1724-ID-19916595-ADNFCR



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Personal Finance , Business


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