MasterCard and Blaze Mobile have partnered to offer a mobile payment initiative it hopes will drive consumer adoption. Using RFID stickers developed by Blaze Mobile, the initiative allows mobile phone owners with an attached sticker to pay for goods at over 141, 000 locations with MasterCard PayPass readers.
While mobile payments using RFID and even SMS have already caught on in countries like Japan, and in African countries with poor banking infrastructure, it’s not often used in North America. One of the major reasons is that most cellphones don’t have RFID chips embedded in them yet. Another major reason is that handset makers, banks, retailers and credit card companies haven’t found a business model that is mutually beneficial.
I think this could be the first step in widespread adoption of mobile payments in North America. In my opinion, carriers don’t have any incentive to offer RFID-embedded phones right now because there is no real mobile payment model in North America. And industry players don’t really have an incentive to develop a business model until they know consumers will adopt the technology. Its a classic chicken-and-egg problem.
With the availability of RFID stickers, and as long as MasterCard and Blaze Mobile make the initiative visible to the average Joe, consumers could become more comfortable with the idea of paying for things with their mobile phone and credit card information. MasterCard was smart in this case to allow consumers to place prepaid funds on a dedicated credit card. By doing this, MasterCard will hopefully help eliminate some of the privacy and identity theft concerns potential users will undoubtedly have. Hopefully if enough people try out the RFID sticker and become comfortable with it, a large enough consumer base will emerge demanding that RFID payment technology be available. Then, just maybe, mobile RFID payments will catch on in North America.