Earlier this month, a number of mobile service providers announced that they would begin integrating smartphones with credit card data in an effort to make shopping easier for Americans. However, new reports show that while the idea may appear to be profitable, carriers may be left with empty wallets at the end of the day.
According to Light Reading, a mobile device news site, carriers are not seeing the big picture. By the time the companies finish paying credit card issuers, merchants and banks, they will be left with little profit.
“There have to be new names for mobile payments to work,” former banker Conrad Sheehan tells the site, claiming that mobile service providers are no match for companies like Visa and MasterCard.
The idea of smartphone and credit card integration is to allow consumers to make purchases and manage their finances on the fly. Americans with access to these advantages may be able to get a better grasp on their credit card debt. Whether the notion will catch fire has yet to be seen. Mobile service providers intend on rolling out pilot programs this fall.