ARLINGTON HEIGHTS, Ill.-Motorola Inc. is hoping to kick-start the lagging mobile-commerce market with a system that allows users to purchase products, transfer funds or pay bills with their cell phones.
The company unveiled M-Wallet, a downloadable application for both smart phones and mass-market devices from Motorola and other manufacturers. Vendors can issue loyalty or gift cards directly to phones with the offering that can be redeemed at brick-and-mortar retail locations, and merchants can send coupons or advertisements to users who choose to receive such offerings.
“Mobile phones are no longer just about conducting conversations, they are now emerging as a center of people’s lives for everyday transactions,” said Navin Mehta, the company’s vice president of applications management.
Motorola hopes to build on successes in Japan and other Asian markets, where consumers are increasingly using their handsets as a payment device at vending machines, convenience stores and retail locations.
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But the manufacturer faces substantial hurdles in its effort to lure customers to use mobile phones in place of credit cards. Motorola has yet to ink a carrier partner for M-Wallet, and must encourage retailers to install technology to accept such payments.
Motorola may also find it difficult to create another link in the m-commerce value chain: The company said it would allow users to store bank-account and credit-card information in its system, and may have to entice financial services providers to surrender a fraction of each mobile payment.
Such partnerships are under way in Japan, where credit-card companies and operators are working together to push the “wallet phone” market. NTT DoCoMo Inc. is teaming with Sumitomo Mitsui Financial Group on such an effort, while KDDI Corp. and Vodafone Group plc’s Japanese unit are partnering with JCB and other finance companies to promote a competing standard.