Pilot programs are nothing new in the payments industry. The card brands (Visa, MasterCard) routinely buddy up with payment technology providers (such as ViVotech) and merchant acquirers (like First Data) to test out new payment technologies. The pilots are designed to work out the kinks in the technology and gauge the interest in it by consumers. Often, the companies publicize the positive results of a given pilot, but then you hear nothing more about it.
But recent announcements seem to point to increased momentum for smart phone payments. In August 2010, an article on Bloomberg reported on a triumvirate of wireless phone carriers -- Verizon, AT&T and T-Mobile -- that apparently partnered with the card brand Discover and Barclays bank for an NFC-enabled smart phone pilot.
And then in September, two more announcements. Point-of-sale terminal manufacturer VeriFone announced a partnership with NFC technology company Bling Nation for a "tap and pay" initiative where consumers would be able to simply tap mobile phones on payment terminals to make purchases. And then First Data announced a partnership with South Korea technology provider SK C&C that would position First Data to become a TSM (trusted services manager) -- a kind of go-between for smart card transactions
The key word is positioning. These companies seem to think that mobile payments will take off eventually and they want to be ready when it happens. And it WILL happen when consumers start clamoring for it.
