The country's first large-scale project to allow mobile payments to be made in shopping centers is set for initiation today in Shanghai.

Handset users can replace traditional SIM cards used in phones with customized RF UIM cards that enable electronic purchases.

The program is being jointly run by China Telecom and Shanghai-based tech firm SEIMMA Tech Co. Users can pay by swiping their handsets on POS machines equipped with special sensors.

The Shanghai launch is a trial. If it proves successful, new projects will be rolled out in places such as supermarkets and restaurants all over the country, Ding Peihua, marketing director of SEIMMA, told the Global Times Thursday.

Two hundred special POS machines and 1,000 RF UIM cards will be available at the launch of the initial project, Ding said.

Besides China Telecom, the country's third largest telecom operator by subscribers, SEIMMA Tech has also been in talks with China Mobile, the country's largest telecom carrier, and China Unicom, the second largest, Ding said.

SEIMMA plans to launch projects with China Mobile in Jiangsu Province in the near future, and with China Unicom in Zhejiang Province, he said.

In the short term, such projects will mainly cover the southern part of the country, Ding said.
There is little to worry about in terms of the application of the technology, Ding believes, adding that the safety of mobile payments is not a concern.

Handset to POS near field communication (NFC) is only usable for small payments of less than 1,000 yuan ($146.44) Ding said.

Users can set up a password for payments above a certain amount, and if they lose their phones, they can report them to telecom carriers, which will immediately send signals over the air to put the phones out of service, he said.

In addition to the NFC model, online banking will make large payments possible.

“An unlimited amount of payments are available as long as your bank card accounts have that much money,” said Zhang Xueying, marketing manager of the Shanghai Handpay Information and Technology Co, which offers remote mobile payment services.

Users can insert SD cards into their phones that enable payments via special transac-tion platforms, or use phones without SD cards to pay via banks' self-owned mobile transaction websites.
At the end of December, payments by users registered with Handpay's mobile payment system totaled more than 60 million yuan ($8.79), according to data from Handpay.

Mobile payments have great potential to grow in the future, if the market keeps making user experience more convenient and diversified, said Cao Fei, a senior analyst with Analysys International, a technology, media and telecom market research firm.

The mobile payment market in China is estimated to have generated 24.28 billion yuan ($3.56 billion) in 2009, with registered users amounting to 98 million, according to the latest data from Analysys International.

Figures measuring the country's mobile payment market consist mainly of money from mobile recharging rather than paying for various services and goods, according to Cao.
Mobile payment still needs time to become well accepted, Cao said.

One business where handset payments may be available soon is Starbucks, said Li Jing, communications manager of Starbucks (China).

Source:globaltimes