ISIS mobile wallet makes official debut

ISIS mobile wallet makes official debut

The wait -- and months of speculation by tech gurus and payment experts -- is finally over: After a delayed summer launch, the Isis Mobile Wallet application made its debut today in two test markets -- Austin, Texas, and Salt Lake City.

Although it's just one of many mobile payment solutions in an increasingly crowded field, Isis has some powerful partners (telecom companies AT&T, Verizon and T-Mobile, as well as card networks Visa, MasterCard, Discover and American Express). And that, experts say, might give this newcomer some clout.

What is Isis?
The Isis Mobile Wallet application uses an app to store the consumer's credit and debit cards, as well as preloaded money, on an near field communications (NFC) chip found in a limited number of smartphones. With Isis downloaded onto a compatible smartphone and payment information entered, consumers can use their phones at participating retailers by simply waving their phones in front of (or tapping them against) the NFC-compatible checkout devices.

If that sounds familiar, it should -- it's the same technology behind Google Wallet. Yet, unlike Google Wallet (which stepped on some card network toes in August when it announced it would be filtering AmEx and Visa payments through a prepaid MasterCard), Isis has the card networks' blessings.

Why all the buzz about Isis?
With the speed at which new developers continue to create new mobile payment options, why is the Isis release receiving so much attention? According to Dave Kaminsky, analyst in Mercator Advisory Group's Emerging Technologies Service in Boston, Isis is big news in large part because it is, well, so big.

"Isis is backed by three of four biggest telecom companies out there," Kaminsky says. "It's a joint venture between T-Mobile, Verizon, and AT&T, so there are very powerful companies backing it."

Company size is not everything, but when combined with the design-forward mobile payment system that plans to eliminate your need for a wallet, the potential impact for merchants, shoppers and the entire payments industry is formidable, Kaminsky says.

Other mobile payment apps require the customer to open a tab with a merchant upon entering the store -- or use their phone to generate a QR code that the merchant scans. That might work well for small-scale purchases at order-at-the-counter establishments, but the process becomes more cumbersome for larger purchases of many items.

"Isis wants to do more than Starbucks, [more than just] giving you an easy way to pay for coffee," Kaminsky says.

What Isis means for merchants
Because Isis relies on NFC, merchants who want to enable payments with Isis will need to upgrade their payment terminals (if they haven't already) to NFC-capable ones. This might make it a bit more of a hardware investment for small businesses than other mobile payment options -- like Square -- which allow merchants to sub in smartphones or tablet PCs for registers and use them to conduct mobile payments.

Another issue is compatibility with customers' handsets. Isis, or any NFC-based app, for that matter, will not work with iPhones unless you have special NFC-enabling accessories, as Apple snubbed the technology with the iPhone 5. That means only customers with certain Android phones would be able to use Isis. There are currently nine Isis-ready handsets available at T-Mobile, Verizon and AT&T retail locations (the Droid Incredible 4F LTE at Verizon; the Samsung Galaxy S3, Samsung Galaxy S2 and Samsung Galaxy Relay 4G at T-Mobile; and the Samsung Galaxy S3, Samsung Exhilarate, Samsung Rugby Pro, HTC One X and LG Escape at AT&T). According to Isis, there will be 11 more by the end of the year.

So should merchants rush to get NFC-enabled terminals? Not quite yet, Kaminsky says. The most savvy approach is to wait and see if NFC takes off.

"NFC and mobile wallets are coming, just not as quickly as we'd thought -- maybe five to six years," Kaminsky says.

Merchants who are upgrading their terminals anyway should make sure they get ones with contactless receivers. In the meantime, "the smaller [mobile payment apps] -- Square, Level Up -- are where you should focus," if you'd like to experiment with mobile payments, Kaminsky says.

See related: Mobile payments round-up: 5 apps to watch, U.S. EMV rollout doesn't mean merchants have to rush

Published: October 22,2023