Bank of America Corporation (NYSE:BAC) is trying out technology that enables customers to pay for goods and services by scanning an image with a smartphone. The bank is working with a company called Paydiant whose technology uses a QR code (image) for smartphones to scan, rather than using near field communications (NFC).
The trial is being conducted with the cooperation of five retailers in BAC’s hometown of Charlotte, North Carolina. As an aside, most people don’t realize it, but Charlotte is the second biggest banking center in the U.S. The Charlotte Chamber of commerce website claims that banking resources of $2.3 trillion are headquartered in Charlotte.
The mobile payment sector is changing rapidly, with everyone from start-ups (such as Paydiant) to technology leaders such as Google are trying to change the face of mobile payments.
Banks such as Bank of America already have a huge stake in this market with their credit and debit cards – and the fees they generate. So it makes sense for BAC to try and get out in front of the revolution in mobile payments, and be a leader rather than a victim.
The technology being tested by BAC requires no upgrades to retailers’ equipment or consumers’ mobile devices. It also doesn’t require any new players to come between customers, retailers and their banks.