Discover would handle the transactions, while Barclays would manage the accounts, according to Business Week. The NFC chip reader would cost around $200, while the chip itself would add around $10 to $15 to a smartphone's cost. Whether or not the system will gain adoption in the U.S. is yet to be seen. Consumers have already been able to leverage similar technology with Visa payWave or Mastercard PayPass, while PayPal has been experimenting with BlingNation stickers that turn any device into an instant payment system.
The new carrier-backed mobile payment system could disrupt the status quo when it comes to credit card transactions, and give Discover a much needed boost to compete against larger rivals like MasterCard and Visa. Although no specific time frame was given, the report claims a trial of the system will be run at stores in Atlanta and "three other U.S. cities."