Future Payment Systems

We may gain insight into future payment systems by examining a leader in the field: Finland. Currently, Fins are beginning to use their cell phones to pay for soft drinks from vending machines, for parking and for car washes. Such arrangements are common in a country where 78 percent of its 2.35 million households have at least one mobile phone. Trials are underway in Sweden designed to allow a consumer to check train schedules and to book and pay for tickets by cell phone.

One advantage that the Nordic countries have is that in the 1980s they agreed on a common standard, G.S.M. (Global System for Mobile communications). In unfortunate contrast, the U.S. has two incompatible systems called T.D.M.A. and C.D.M.A. One result of this technological split is that most Americans cannot use their mobile phones overseas, while a citizen of Finland can phone home from Rome.

This discussion is provided as background to the announcement that Trintech Group, PLC has formed a partnership with Visa International. Trintech provides electronic-payment technology and will work with Visa to provide services for secured credit-card transactions using wireless devices. Trintech has developed a software, Pay-Ware Access, that is designed to safeguard electronic payments by users of cell phones. Visa has agreed to promote the software and industry standards for its use.