Buying & Selling With Your Mobile Phone

The Smart phone is the new Swiss Army Knife of the digital age.  Many of us feel naked if we reach in our pocket or purse and find that we have left our phone at home.  Using it to make phone calls is among its less used features.  The GPS app helps us find our way to that next meeting or new restaurant. The calendar app makes sure we go there on the right day and access to Google has helped settle many a friendly bar bet. What city is farther east: Miami, Florida or Lima, Peru?

Well, the Swiss not only make neat knives, they are also noted for their financial acuity so it is interesting to note that today’s smart phones are morphing into electronic wallets and cash registers.

Using phones to purchase goods and services has been very prevalent in some European countries but has been slow to take off in the USA.  There are, however, a few companies that have embraced the service.  Starbucks’ mobile app is one of the most popular. You enter your Starbucks Card account number into your phone and it becomes your Starbucks Card. Your device will display a barcode you can use as your Starbucks Card to make purchases. This “Mobile Pay” is now available at over 7,000 company-operated Starbucks stores nationwide.  To date, there are some movie theatres and other entertainment venues that also accept payment using your smart phone.

Not only can smart phones be used to pay for items, they can be used to accept payment.  Applications that turn your iPhone or Android into a credit card terminal are now becoming commonplace.  Taking credit cards as payment once required signing up with one of the big credit card companies, i.e. MasterCard or Visa, and since you needed to have a brick-sized terminal connected to a phone line, it was impossible to verify a card at the point of purchase in a mobile environment.

Today, companies like Square.com provide a small attachment to an iPhone or Android phone that makes the phone a credit card terminal.  So the pizza guy or cab driver can take your card and verify in real time the transaction.  My oldest son runs a pedicab service in Cleveland and he uses this service to allow his customers to use credit cards on the go.

If this technology takes off like it has in some of the Scandinavian countries, soon getting a Pepsi and bag of chips from the vending machine will require only a wave of your iPhone in front of the machine. The phone bill might have a charge for minutes and calories.