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Wednesday, February 16, 2011

Paying for groceries with your mobile phone

News from Barcelona (see my previous post) says the mobile phone industry in the USA is gearing up to make mobile phones a payment mechanism... another step in the cash-less society that we've been hearing about for 30 years.

Mobile phones are already used as a substitute for cash in major Asian cities. Place a mobile phone near a point-of-sale device, and a debit transaction ensues.

In London recently I was impressed by the Oyster Card system of the Underground. It's not on mobile phones yet, but the philosophy is excellent and extensible to mobile phones. You can preload an Oyster Card with value and arrange for it to be automatically topped up from your bank account whenever the balance hits a minimum value. You can go online for balance inquiry, ad hoc top-up, and reporting the card as lost. The card does not have to be swiped at the turnstile; you simply place it within an inch or two of a clearly marked reader. No physical contact is needed; it's all done by radio.

The next generation of smartphones here will include this technology, known as NFC. The data communications capability of the smartphone -- and if necessary, the brute force browser -- will allow a user to check balances, top up the balance, etc.

I'm surprised that cash has hung on here as long as it has. Most other nations have replaced their equivalents of the $1 and $2 bill with coins. That makes great sense, as does eliminating the penny -- despite the well-organized opposition from manufacturers of zinc.

Meanwhile the redesigned $100 bill has been delayed again. It was schedule to circulate this week. Did you know that most $100 bills circulate overseas as substitutes for local currency?

Many years ago, when the US began to eliminate bills larger than $100 to make life inconvenient for drug dealers, my dad obtained a $500 bill and gave it to me. I regret that I don't remember what became of it. The Swiss have a 1000 franc bill, worth about $960. It's the most valuable bill that's easy to obtain these days. Beautifully designed, too.

But if you want to own a $500, $1000, $5000, or $10000 bill, go here.