Visa just announced a “digital wallet” initiative that will launch later this year and it is aimed at making mobile and Internet purchases much easier.
This isn’t the first Visa has dabbled in the mobile space but this could be its most ambitious. Essentially, the company wants to create a digital wallet which will let you buy things by just entering an e-mail (likely with a password) instead of having to fill out forms with your credit card number and your expiration date.
This will have a strong impact on the mobile, as the company will be leveraging its Visa PayWave apps to enable tap-to-buy functionalities with NFC. The company said it would open this up to other payment providers as well. This move could have a big impact around the world too, as the company said:
· In countries like India and Russia, where card issuance and mobile subscriptions are high, but card usage is relatively low, Visa will help drive account activation and usage by working with financial institutions and mobile operators to link existing card portfolios with mobile devices to give handsets payments functionality.
· In countries within Africa and the Middle East where mobile device usage is high and traditional electronic payments infrastructure is less developed, Visa will work with mobile network operators to link new virtual mobile prepaid Visa accounts to mobile phone numbers to enable cash-in, cash-out, personal payments and mobile payments —including bill payments and wireless airtime top-up. Visa also intends to connect existing “closed loop” mobile money services that today provide basic mobile banking and payments services to unbanked and under-banked consumers to its global, open loop network—VisaNet. The integration will open closed loop systems, and provide consumers and merchants with unprecedented scale, functionality and acceptance beyond their existing local geographic footprints.
It’s important that this is Visa’s initiative because it has massive weight in this space. The carriers and Discover tried to launch a separate mobile payment platform but quickly relented to include Visa and MasterCard.