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Visa's Digital Wallet Is An Inevitable Step Toward A Cardless Future

The newly-announced electronic payments capabilities might break the 'mobile wallet' concept from the realm of science fiction.

The digital wallet -- the idea of consolidating payment, loyalty and identity information into one straightforward, mobile and online-enabled solution -- has become a sort of Holy Grail in next-generation payments. A confluence connectivity, technology, mobility and ubiquity, the concept has languished as a sort of not-so-distant science fiction that any number of stakeholders has raced to achieve.

Visa Inc. announced today something that, by this year's holiday shopping season, could prove definitively whether the masses are finally ready to shed stacks of plastic. Slated for a North American launch sometime between the beginning of fall and the beginning of the holiday shopping season, Visa's new Digital Wallet with "Click-to-Buy" functionality represent an array of cross-channel services that further digitize and simplify online payments and could, eventually, drive adoption of mobile near field communications-enabled payments.

"We believe NFC over the next 3-5 years will be a capability at the physical level," says Jennifer Schulz, Head of Innovation, Visa Inc.

Schulz adds that allowing for the digital wallet -- where consumers can securely store various credit or debit cards, identity info and loyalty programs -- to be accessed at the physical point of sale through NFC technology is essential from an online channel approach. That the payment terminal manufacturers and most handset manufacturers have both been adopting NFC technology in their devices is good news.

In the meantime Visa is also planning on leveraging mobile messaging technology and email alerts. As an online payments option, once the Digital Wallet is available, consumers will be able to enter payments details into a preference center, choose how they wish to pay -- whether through credit card, debit card -- based on type of transaction or at point of sale, and purchase goods online as easily as making one click.

"This capability will allow you to use the payment choices and payment types you are interested in using when you want to use them," Schulz says.

It's an open system, she adds, meaning that banks and merchants can brand it or extend it as they choose, and payment options customers can load into the Digital Wallet won't be limited to just Visa cards.

In all, Visa's announcement is a tangible step toward the high concept mobile wallet, and could affect how people do business online and at the physical point of sale.

"There’s a lot of activity around cash and checks moving toward a digital currency, and that runway is long," Schulz adds.

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