Visa and MasterCard are now supporting new internet-based technologies that allow users to pay for shopping using contactless payment systems through mobile phones.
The companies have developed new applications which allow the users to make payments by connecting the phone with store’s card reader.
The new technology, which is compatible with the Google’s Android operating system, allows the user to store card information on a remote server that can be retrieved using retail or banking app on the phone.
Visa’s support for cloud-based payments follows introduction of a new feature in the Android mobile operating system called Host Card Emulation (HCE) which allows the NFC application on an Android device to emulate a smart card.
The technology allows users to wave-to-pay with their smartphones, while permitting financial institutions to host payment accounts in a virtual cloud.
Visa Global Solutions executive vice president Elizabeth Buse said the clients and partners around the globe are continuously looking for flexible, cost efficient and secure ways to enable mobile payments.
"The Android HCE feature provides us with a platform to evolve the Visa payWave standard, support the development of secure, cloud-based mobile applications, while at the same time offer greater choice to our clients," Buse said.
For specification development process, MasterCard worked with Capital One on a pilot project and with Banco Sabadell on a European pilot project which the company says will help in additional deployments planned in 2014 with other financial institutions around the world.
Capital One executive vice president Digital Jack Forestell said, "For Capital One, the pilot was about exploring new ways to commercially deploy an NFC-based offering and securely store credentials."
Google Android product manager Benjamin Poiesz said the Android community continues to build innovative ways to improve the lives of mobile users.
"We introduced HCE to make it easier for developers to create NFC applications like mobile payments, loyalty programmes, transit passes, and other custom services," said Poiesz.
"Visa’s move to enable NFC payments with Android devices is welcome news and will guide the way for the payments industry."
MasterCard emerging payments group head James Anderson said, "The use of HCE provides a very attractive way forward to launch an increased number of NFC-based offerings."
