Paying Up? Put It on Your Phone

By Barbara Kiviat

The idea of using your cell phone as a credit card at a cash register to pay for a burger and fries or a new winter coat is still largely a futuristic notion in the U.S. and Europe. Yet parts of Asia are making serious strides toward mobile finance as a fully functional reality. In Japan, telecom NTT DoCoMo and financial firms Nippon Shinpan and Visa International are rolling out the second test phase of an infrared-enabled payment system, which will include 1,000 merchants and 10,000 consumers. Peddlers of the technology have gained an even greater foothold in South Korea, a cell phone--obsessed society in which wireless providers are competing for market share with hot technology. The leader, SK Telecom, has already sold 370,000 enabled handsets and should have reader technology installed at 400,000 stores by year-end. SK has only 30,000 subscribers, but, as with store value cards, the idea has viral growth potential. "M-finance is still in its infancy," says Natasha Tan, research manager at consulting firm IDC in Singapore. "But turning cell phones into electronic wallets is here to stay."