Wireless Payment Options
Secure electronic funds transfer and positive user transaction experiences are crucial to the success of e-commerce and m-commerce. Businesses that offer domestic and international products and services must ensure that m-payments (payments made via wireless devices) will be received securely and that the transactions are valid.
The variety of wireless devices, the lack of m-payment interoperability and the imma-turity of the m-payment industry have led to inconsistent user experiences. Interoperability, the ability for transactions to be performed using any software or device, is a major hurdle for the m-payment market. Organizations such as Global Mobile Commerce Interopera-bility Group (GMCIG) and Mobile Electronic Transactions (MeT) Group support stan-dards that enhance interoperability.
Traditionally, banks and credit-card companies process payments. Currently, micro-payments, or payments under $10, are the most popular m-payment application. This creates problems, because banks and credit-card companies cannot process micropayments profitably. Often, the cost to financial institutions of processing small payments is more than the actual payment amount. Mobile-phone operators are best suited to handle micro-payments because the phone bills that they produce are composed almost exclusively of small charges. However, mobile operators are not equipped to assume the financial risk associated with payment processing for services other than theirs, and consumers may not trust a mobile operator to act as a financial institution.
To address this issue until m-payments are used for larger purchases, banks and wire-less operators have begun to form partnerships. Through such affiliations, wireless opera-tors can offer their users a convenient billing system for m-payments, while banks provide experience in payment processing and financial risk management. Another alternative is for banks to become Mobile Virtual Network Operators (MVNO). MVNOs purchase band-width capacity from mobile carriers and resell it under their brand name, coupled with value-added services.
M-wallets are the most common form of transaction software offered by the developing m-payments market. M-wallets, like e-wallets, allow users to store billing and shipping infor-mation. Users can recall this information and enter it with one click while shopping from a mobile device. Data entry on wireless devices can be time-consuming, because most devices have small keypads on which multiple keys must be pressed to display a correct letter. By enabling one-click shopping, m-wallet software simplifies the ordering process and adds con-venience to m-business transactions. In addition, companies are integrating new technologies into m-wallet software. For example, Qpass’ TalkWallet™ uses speech-recognition and voice-authentication technologies to enable cell-phone users to make purchases by speaking into their phones. Such applications eliminate the need for keypad data entry.
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