Payments innovation is cross-pollinating ideas across the world, says Nick Holland, of Mercator Advisory Group, with MasterCard’s contactless PayPass product, for one, based on the success of initiatives in southeast Asia. In a new report, “Payments Innovation in Southeast Asia – Through The Looking Glass”, Mercator profiles payments products based on Sony’s FeliCa contactless technology, and assesses how the US can adapt these to its needs. Products like Sony’s Edy e-wallet and Hong Kong’s Octopus card, for instance, proved the early business case for contactless payment cards.

Southeast Asia, by contrast, is still taking to the concept of revolving credit and the implications the availability of easy credit has for consumers, merchants and other players in the value chain. Mobile phone-based payment technologies are more advanced in Southeast Asia simply because high telecom costs called for low-cost evolutionary technologies. Conversely, US consumers still rely on magnetic-stripe payment cards, as this is the system on which existing real-time fraud detection functions are based, and no ‘quick’ fix was required, Mercator’s Holland says.

Just this week, Japan’s premier parking lot operator, Park 24, announced an experiment to test a FeliCa-based cashless payment solution at its metered parking lots. In the pilot, holders of NTT DoCoMo FeliCa -enabled mobile phones will be able to pay parking meter fees simply by holding their phone handset against a contactless reader. Given the credit-averse nature of consumers in Japan, prepaid e-purse accounts are seen as the best way to gain mass-market acceptance for new payment technologies, whether these are based on contact- or contactless systems.

(eMediaWire)