Japanese telcos to launch mobile payments service

Japanese telcos to launch mobile payments service

Japanese telcos NTT DoCoMo, KDDI and J-Phone are teaming up to launch a payments system that will allow mobile phone users to pay for purchases made over the Internet in stores, according to Japanese news reports.

The new system is based on a service introduced by NTT DoCoMo in May 2002 which allows users to pay bills at designated stores using their mobile hand sets.

To use the service, customers who have made an online purchase will download a two-dimensional bar code, which contains billing information, onto their mobile phones. At the store, the customer waves the phone at a bar code reader which then displays the billing data. Once the information has been confirmed the customer pays for the purchase with cash.

The firms are targeting the service at customers who do not have a credit card as well as those who do not want to pay for online purchases with cards.

The system eliminates paperwork such as bills and receipts that are usually sent to online shoppers through the post, therefore reducing costs for Internet retailers. The phone companies will benefit from transaction commissions and fees charged for transmitting the purchase data bar codes.

NTT DoCoMo plans to launch the service this month, enabling its mobile phone subscribers to pay for CDs purchased online at am/pm stores nationwide. Convenience store operators Lawson and Ministop are expected to join the initiative at the end of the year.

KDDI will launch the service for its subscribers by early next year. J-Phone does not yet have a launch date.

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