HSBC Credit Card Services, the U.S. credit card unit of one of the world's largest financial services companies, has launched a mobile phone payments pilot, in partnership with MasterCard and ViVOtech.


The six-month pilot tests the use of Near Field Communication (NFC) enabled mobile phones to make contactless credit card purchases. More than 200 HSBC employees in New York, Chicago and several other large U.S. cities used a simple, "over-the-air" (OTA) personalization process to securely load their HSBC credit card data onto their mobile phones.

"Putting payment capability into mobile phones is our latest effort to employ innovative technology in our credit card business," said Walter Menezes, chief executive of HSBC Card Services. HSBC introduced contactless debit cards to its bank customers in late 2005 and contactless credit cards in 2006.

The new phones feature NFC technology, which enables users to make contactless purchases at any of the approximately 36,000 merchant locations around the world that accept PayPass, including 7-Eleven stores, McDonald's, Jack-in-the-Box, CVS, Duane Reade, Sheetz and Regal Entertainment Group. PayPass is also now accepted in numerous baseball and football stadiums as its quick transaction time allows sports fans to spend less time in line and more time enjoying the game.

PayPass offers consumers a convenient alternative to cash that allows for small-ticket purchases to be completed quickly, securely and easily. Consumers no longer need to fumble for cash and coins, swipe a card, or sign a receipt for any PayPass purchase under $25. Users simply tap their PayPass-enabled phone, card, or device on the PayPass reader at participating merchants and they are on their way.

"MasterCard is excited about the future of mobile phone payments, particularly as today's consumers rely increasingly on their mobile phones for activities other than calls," said Art Kranzley, executive vice president and group executive, Advanced Payments, MasterCard Worldwide.

NFC is a short-range proximity technology that uses radio frequency (RF) to enable secure, contactless communication between two devices. Contactless payment is only one of the many data-transfer applications that NFC enables, which makes it an attractive technology for carriers looking to increase handset utility for consumers.

"An easy to use solution is the key for the successful adoption of mobile phone payment by consumers. We were happy to see trial participants were personally able to download their HSBC credit cards securely into mobile phones and were ready to make payments," said Michael Mullagh, CEO, ViVOtech, which provided wallet, smart poster, and over-the-air (OTA) payment provisioning software for NFC enabled mobile phones.