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US Bank taps NFC to enable mobile payments on iPhones

U.S. Bank is leveraging NFC technology as a way to let consumers pay for everyday purchases with their iPhone 4 and iPhone 4S devices.

Customers with a U.S. Bank FlexPerks Visa account who opt-in for the service will receive a customized U.S. Bank Go Mobile iPhone case equipped with NFC technology. With the case on their iPhones, these customers will be able to pay for purchases at retailers that accept Visa payWave by holding their phones over the contactless point-of-sale systems.

“U.S. Bank has a large payments business and is innovating in the payments space,” said Todd Moning of the payments innovation group at U.S. Bank, Minneapolis. “A big part of that is research and development of new ways for our customers to acquire and use their payment accounts on new devices, such as smartphones.

“Offering payment applications for mobile devices prepares our customers and partners for the new wave of mobile payment types that are emerging,” he said.

The case for NFC
With consumer interest in mobile payments growing and banks looking for a way to be a part of the equation, U.S. Bank is working around the fact that the iPhone does not come with embedded NFC technology by offering customers a phone case with the technology.

The U.S. Bank Go Mobile program is launching first in Salt Lake City, UT, and Portland, OR. U.S. Bank is introducing the service in beta with new FlexPerks Travel Rewards Visa Signature account holders before introducing it more broadly in 2013.

In addition to enabling mobile payments, the case that participating customers will receive also has an extra battery extending a phone’s charge time by more than 50 percent.

The bank incorporated feedback from previous pilots as well as customer research into the development of the U.S. Bank Go Mobile program.

“Our goal is to understand the experience our customers have with this new way to pay so that we can continue to find ways to add value to their daily lives,” Mr. Monin said. “We are offering this technology as a new way for U.S. Bank customers to use their iPhone to apply, get approved for, use and manage their FlexPerks Travel Rewards Visa Signature Card.”

Value-add for customers
To use the service, customers download the U.S. Bank Go Mobile app and follow the on-screen prompts to apply for the U.S. Bank FlexPerks Travel Rewards Visa Signature card. Once approved, users then follow the on-screen prompts to opt into the U.S. Bank Go Mobile Beta to receive the U.S. Bank Go Mobile Case and battery pack.

After the card has been activated and the case put on a phone, users open the app and create a personal pass code. When users are shopping, they can look for a symbol that lets them know the Visa payWave-enabled readers are available.

To pay, users open the app, select “pay,” enter their pass code and then place their iPhone one to two inches above the terminal reader.

U.S. Bank partnered with Visa, DeviceFidelity and Datacard Group to bring the payment technology to its customers. The iPhone case used for the Go Mobile payment service is developed and patented by DeviceFidelity.

“This app is a new, value-added way for FlexPerks customers to manage their accounts, and for some new FlexPerks customers to complement their dual-interface EMV card by allowing them to pay with their iPhone wherever Visa payWave is accepted,” Mr. Monin said.

Final Take
Chantal Tode is associate editor on Mobile Commerce Daily, New York