Telecom New Zealand to launch mPayment solutions

ASB Bank and Telecom are launching a mobile payment service that, in the future, will enable consumers to pay for goods and services from their bank account using their mobile phone.

The service is generically known as Mobile Payment or mPayment in the industry. The mPayment solution joins the customer’s mobile phone directly with their bank account, unlike micro-payment solutions which simply charge costs to the customer’s mobile phone account. Emerging examples of micro-payment solutions worldwide include vending machine purchases and parking tickets.

Initially, the service will enable consumers with a Telecom Prepaid mobile phone and an ASB Bank account to top-up their phone credit from their bank account via SMS. In the future, consumers will be able to purchase any number of goods and services in situations where they are not in front of the merchant or don’t have access to traditional payment methods of cash, EFTPOS (an electronic funds transfer service) or credit card.

For Telecom Prepaid mobile customers, the new mPayment solution will provide them with a further alternative to topping up their phone via scratch cards, credit cards, or ATM.

According to Telecom, this mPayment solution delivers a high level of security as it requires an alphanumeric password for authentication of the user’s identity. In addition, by providing payment direct from the user’s bank account, mPayment means the spending power of users is not limited to the amount of credit available on their phone account.

ASB Bank and Telecom’s Advanced Solutions group completed technical trials over the Christmas period, and plan to establish the mPayment capability and commercially launch the Telecom Prepaid top-up service to customers in late March 2004.