PARIS — Visa Inc. is making mobile payments chips available to any of its partner banks, a move that pushes it ahead of rivals largely still in smaller tests with competing mobile payment technologies.
The system Visa launched Tuesday involves inserting a microSD card into a mobile phone's memory slot and has been in testing for the last 18 months with four major banks.
Visa announced at the Cartes & Identification conference here that it is making the microSD cards available to its issuing banks on a commercial basis. The system was developed with DeviceFidelity Inc. of Richardson, Texas.
"Now the banks that are interested in testing it, piloting it or even going to market have basically a straight shot from a Visa rules perspective," Dave Wentker, the head of mobile development for Visa, said in an interview at Cartes.
Visa had previously disclosed that Bank of America Corp., U.S. Bancorp, JPMorgan Chase & Co. and Wells Fargo & Co. were testing the service. Participating banks can issue the microSD cards containing the customer's account information.
Visa has seen interest in the technology from large and small financial institutions, Wentker said.
Wells Fargo on Tuesday said its pilot program involves 200 Wells employees using certain BlackBerry and iPhone models.
Participants will launch Wells Fargo's mobile banking application, which has integrated Visa's payWave contactless specifications, on their phone to transact with their device. They then wave the phone by a merchant's contactless reader, similar to using a contactless credit or debit card.
In the case of Wells Fargo, participants can link one Visa-branded credit card and debit card to the app.
Peter Ho, Wells Fargo's product manager for card services and consumer lending, said in a press release that the service will help "our customers conduct their financial transactions when, where and how they want."
A demo of three of the four issuers' apps at Visa's booth showed different approaches to deploying the system.
While Wells Fargo is testing using its existing mobile banking application, Bank of America is trying out the technology with an app separate from its existing mobile banking application.
Visa's technology currently is compatible with the BlackBerry Bold 9650, the iPhone 4, the iPhone 3GS, iPhone 3G and Samsung Vibrant Galaxy 5, which uses Google Inc.'s Android operating system. It plans to add additional handsets, including those running on the Symbian and Windows Mobile operating systems.
With the iPhone, customers must use special cases that can hold DeviceFidelity's microSD card, because the Apple Inc. device does not have an external memory slot.
Other companies have tested or begun issuing contactless payments in the form of stickers that are meant to be affixed to consumers' mobile phones. The stickers do not have the same ability as microSD cards to speak directly to the phone hardware, and are thus widely considered an interim technology.
Citigroup Inc. offers stickers to some customers with MasterCard Inc.-branded credit cards. Discover Financial Services has tested stickers with more than 700 employees. Separate from the Visa/DeviceFidelity system, Bank of America is planning to issue stickers next year. Bling Nation Ltd. offers stickers through its partner banks and eBay Inc.'s PayPal; though this system is in full rollout with various issuers, it has much less reach than Visa's.
Deepak Jain, the president and chief executive of DeviceFidelity, said during a presentation Tuesday that using a microSD card gets around some of the challenges that other approaches, including those that hinge on embedding near-field communication chips inside of phones, face. It "is not scaring anybody in terms of a new device," Jain said. "It's really the same … device that's out there in a different form."
Visa's is one of several mobile payments initiatives expected to be announced at Cartes & Identification. MasterCard on Tuesday said it and partners Gemalto NV, GarantiBank and Avea, a subsidiary of Turk Telekomunikasyon AS, had made a mobile payments system involving a SIM card commercially available in Turkey.
The approach is applicable to the U.S., Ed McLaughlin, the global head of emerging products for MasterCard, said at Cartes.
Ajay Banga, MasterCard's president and CEO, said during its earnings conference call in November that it planned to expand its mobile payments trials in the first quarter of 2011 by testing a microSD card approach with a large U.S. issuer.
