Mastercard and Visa to go wireless

MasterCard and Visa have formed separate partnerships that will enable them to offer secure payment facilities to mobile device users.

MasterCard this week announced that it had formed a strategic alliance with InterVoice-Brite, a network services provider, to develop and market solutions for conducting secure payment transactions using mobile wireless devices, including phones and personal digital assistants.

InterVoice and MasterCard say they intend to work with MasterCard member institutions to implement mobile ecommerce solutions in key markets around the world in conjunction with selected mobile operators and handset manufacturers. The companies are expected to roll out their first applications later this year.

Last November, MasterCard announced the formation of its Global Mobile Commerce Team to focus on the convergence of the card payment and mobile telephony industries. The alliance with InterVoice brings the company closer to its goal of having an infrastructure in place that allows consumers to use wireless devices to conduct transactions over the internet.

MasterCard and Motorola announced last month that they would work together to develop a standard for wireless purchasing. The companies said consumers will be able to pay for goods and services over a Motorola Internet phone or other wireless devices using their MasterCard.

Visa, which announced the formation of a separate unit last autumn to step up its ecommerce efforts, is following the same strategy of partnering with technology companies to grab a slice of the mobile ecommerce market.

It is also working with Trintech Group, which has an online wireless payment solution, to make Trintech's technology capable of tapping into Visa's network for processing credit card payments.

In May, Visa and Aether Systems, a leading provider of wireless data services and systems, announced a partnership to develop the mobile ecommerce marketplace. The companies said they intend to jointly market, develop and pilot innovations, as well as work together on standards and technology applications.

The companies also announced a partnership with CyberBills, a bill management company, to market applications enabling users to pay various bills via hand-held devices and mobile phones, and to securely store bill and payment information.

That the credit card companies are making moves to secure their place in the mobile ecommerce market is not surprising, given the number of users going wireless.

The Yankee Group estimates that there will be 48 million users of internet-enabled smart phones worldwide by 2002, soaring to 204 million by 2005. It also expects mobile ecommerce to account for 25 per cent of all ecommerce by 2005.