Deal Advances E-Wallet Technology, But Adoption Still Slow

mobile phoneAlcatel-Lucent's venture touchatag and Belgian m-payment company PingPing have joined efforts to promote application development for cashless payments and services.

The two companies will create a business model combining PingPing's payment system for mobile phones and touchatag's contactless services. The services run the gambit, from interactive advertising and loyalty programs, to coupon services and advertising campaigns.

PingPing and Touchatag will work together to create an accreditation program that allows other technology suppliers, operators and application developers to develop programs based on the technology. Belgian consumers will have an option to initiate a variety of contactless applications such as m-payments based on a contactless card or sticker by fall.

Although cashless applications are the next step in the evolution of the "electronic wallet," or "e-wallet," carriers and handset makers in the United States have yet to come to terms with guidelines or standards. The inability to come to consensus has slowed U.S. adoption, even of the simplest applications, such as coupons and ads.

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The e-wallet enables electronic payments. The technology makes it possible to pay for a service, such as a theater ticket or gas purchase, by simply waving a contactless card or mobile phone in front of a point of sale terminal or a poster. And while it has been possible to make payments with tap-and-go cards, many PoS terminals have not had the capacity to accept cashless transactions, according to Dan Mullen, president at AIM Global, an industry trade group spearheading the adoption of automatic identification technologies. "It has to be easier and more secure than what people use today," he says. "It has to provide some added value, such as times saving or information." As an example, he suggests an application on a BlackBerry or iPhone that tells the consumer how much gas they have remaining in their car based on the amount of money spent at the pump in the past six months, Mullen says.

While this type of payment is becoming common on the Internet, it has not made its way from the PC or Mac to the physical world on cell phones. Solutions based on SMS have existed for years, but they are still quite cumbersome for use at PoS terminals.

Retailers can send coupons to loyal customers via the phone. The electronic messages are kept in the e-wallet until redeemed at the store's PoS terminal. Companies such as Alcatel-Lucent aim to replace traditional wallets, in many cases. Consumers can store electronic coins, banknotes, plastic cards, paper vouchers, loyalty cards and tickets on a server.

Accor Services, which provides meal vouchers, is the first company to trial the PingPing/touchatag payment system. Alcatel-Lucent employees in Belgium have been using a contactless card with touchatag as a replacement for paper meal vouchers since June 2008.

1 comment about "Deal Advances E-Wallet Technology, But Adoption Still Slow".
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  1. Anne Gallagher from Catapult Marketing, June 4, 2009 at 11:23 a.m.

    Thanks for the article, but I am surprised that you didn't mention 2D codes directly. While RFID tagging isn't as readily accessible to the general public since you need a reader and some cash to create the tags, 2D codes can be used by anyone with a smartphone, right now, for free.

    The slow adoption rate in the U.S. has been a Catch-22; marketers & retailers hesitate to use & promote the technology because the public doesn't use it, but the public doesn't use it because they've never seen it. Hopefully awareness will start to pick up momentum because the communication and marketing potential of 2D codes are really exciting. Thanks.

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