Credit Card Gist

iPhone users may soon be able to make contactless credit card payments using their phones, according to a leaked press release that was quickly pulled. The wireless payment capability would be provided by Visa’s payWave service.

Where Visa payWave is supported, cardholders can wave their card in front of a reader, instead of swiping it through a point-of-sale (POS) terminal. According to Visa, “over 32,000 retailers from 20 top brands accept Visa payWave payments.”

To use payWave, iPhone users would have to have it pre-installed on a memory card. As the iPhone does not have an external memory slot of its own, users will be required to get a new iPhone protective case, which is said to be already Apple-certified.

Once they have payWave installed, iPhone users will only have to wave their phones in front of a payWave-enabled reader to make a payment. The mobile payment application can be password protected and will work on both iPhone 3GS and iPhone 3G devices.

(See the full text of the pulled press release here.)

Starbucks has expanded its trial of an iPhone mobile payment application from 16 West Coast stores to 1,000 locations nationwide. The service, called Starbucks Mobile Card, allows Starbucks Loyalty cardholders to enter their account number in the application and start using the phone as a credit card.

Once the service is set up, a Starbucks Mobile Card user can pay for her latte by having her iPhone’s screen scanned, instead of using the actual card. The app also works on iPods and perhaps will be available on iPads in due time.

The app also allows users to check their Starbucks Card balance and reload their Starbucks Card using a credit or debit card.

The service is the result of a collaboration between Starbucks and Target and is probably the biggest mobile payment trial so far. It would be interesting to follow the experiment and see if consumers are willing to replace their plastic cards with their phones.

(Via Starbucks.com)

Twitter co-founder’s latest creation can now be used on Apple’s latest buzz-generator – the iPad. Jack Dorsey’s Square was initially launched for the iPhone. Subscribers get a small card reader that plugs into the phone’s audio jack and users will now be able to use it with iPads as well.

Square works by enabling buyers to swipe their credit cards through the reader and producing a sales receipt that is displayed on the device’s touchscreen. A photo of the card’s true owner appears on the screen; if it’s the right person, the seller taps a button, the transaction goes through, and the buyer receives a receipt by email or SMS.

Square also enables users to “Generate email and SMS receipts for cash and card payments, maintain frequently sold items, calculate sales tax, and effortlessly manage and visualize all the money you take with an intuitive web-based interface,” according to the company.

(Via SquareUp.com)

Swipe It is the name of the latest entry into the iPhone credit card processing fray, joining Square and iCharge, among others. Swipe it lets users connect an iPhone or an iPod Touch to a credit card terminal, which costs $0.99. The terminal comes with an AC adapter and can also charge the iPhone while it’s connected.

Some of the more important features of the new payment system are:

• Swiped data is encrypted before it’s transmitted from the reader to the Swipe It app.
• Support for Visa, MasterCard, American Express and Discover.
• Swiped transactions are processed at “card-present” rates, much lower than non-swiped transactions.
• The Swipe It app is available to download on Apple’s App Store.
• Swipe It works both on the cell phone data network and Wi-Fi broadband connection.

(Via Macally.com)

From left to right: VeriFone, Mophie and Square

Three companies have recently introduced payment acceptance services that allow users to turn their iPhones into point of sale terminals. Two of the contenders – Square and Mophie – are start-ups, while the third service is offered by VeriFone – an industry heavyweight.

The three rivals are vying for the attention – and wallets – of the same target group – the mobile work force. Square is currently being tested at flower shops, food carts and cafés, among others. Other potential users include “the guy that comes to your home to detail your car, the repairman who comes to fix a broken faucet, the person who sells you a piece of art and maybe sells only two or three a week,” suggests Douglas Bergeron, the CEO of VeriFone.

Other iPhone applications, including InnerFence, iMerchant Pro and Swipe It, also offer credit card acceptance. The difference that VeriFone, Square and Mophie bring to the battlefield is that their services’ card reading capabilities allow payments to be qualified as “card-present” transactions which cost merchants less in processing costs, while reducing errors and fraud.

(Via CNNMoney.com)