Time to Throw Away Your Wallet?

In Europe and Asia, people use their cell phones for more than just communications. In addition to all the talking, text messaging, and photographing we can do here in the States, Finns can pay for parking with their phones. South Koreans can watch TV on theirs. Japanese can wave a phone in front of a vending machine to pay for a soda.  

But today I saw technology from a company that might turn U.S. phones into electronic wallets, too.  The company, Black Lab Mobile, has built a platform that turns almost any cell phone into a credit-card processing system.

What was most interesting about the platform was its flexibility. It’s intuitive enough that two people could set themselves up and transfer money between their credit cards in minutes, or it can scale up to full-on business use, even tying in to an existing point of sale system.

Oversimplified, the system uses the customer’s cell phone number and a PIN code to authorize credit card transactions. Neither the seller nor the buyer needs any special hardware, each just has to have a cell phone that supports SMS messaging (receipts and other notifications are delivered via text messages).

CEO James Linlor’s vision is to turn cell phones into a low-cost, low barrier-to-entry option for credit card transactions. The system doesn’t require new infrastructure. It appears to be more secure than traditional credit card systems (you must have the phone and the PIN for it to work). And it offers a variety of additional opportunities to add value to the process.

For instance, Linlor showed me a demo of a restaurant paging application that would allow diners to receive a text message when their table was ready–and might even include a coupon, say, for the coffee shop next door.

Black Lab Mobile is small, with no guarantees it will ever get big. But the scalability of its model means it already has customers–small ones, but customers nonetheless. And I, for one, am looking forward to the day when I can lose a few cards from my wallet.