AT&T, Verizon, T-Mobile Want Smartphones to Replace Credit Cards
AT&T and Verizon want to take on Visa and MasterCard by making it possible to pay for things with a simple wave of a smartphone.
Several anonymous sources in the telecom industry have reported to Bloomberg that AT&T and Verizon, in partnership with T-Mobile, Discover Financial Services and Barclays Plc, are planning to take on Visa and MasterCard directly by building a wireless credit card payment system into their smartphones .
Some credit cards are able to pay without swiping through a machine; simply waving the card near the payment kiosk is enough to make a transaction. The process would be similar for AT&T and Verizon, except customers would wave their smartphone instead of a credit card.
The partnership is reportedly in search of a CEO and is supposed to start tests at stores in Atlanta and three other U.S. cities.
This isn't new technology, though. Smartphone users in Japan, Turkey and the U.K. have already been using their phones to make payments. But by partnering with Discover and Barclays, which will handle the accounts, AT&T and Verizon will be able to get in on the multi-billion dollar credit card business. According to the sources, AT&T and Verizon are equal partners and T-Mobile has a smaller share in the partnership.