A joint venture between Bank of America and Atlanta payment processor First Data is jumping into the game of turning smart phones and tablets into cashless pay stations.
Atlanta-based Bank of America Merchant Services unveiled on Tuesday its Mobile Pay on Demand card readers and mobile applications, becoming the latest challenger in a crowded new niche for processing credit and debit cards for smaller businesses that want to be more mobile or ones that are new to electronic payments.
Smart phone card readers are becoming a hot market, tapping into all-cash businesses or those that want to offer electronic payments where they provide services, even if it isn’t in the office.
Mobile Pay on Demand works with iPhones, iPads, smart phones and tablets that operate on Google’s Android platform, and it allows merchants to swipe a credit card through a plug-in card reader. The system is set to launch Dec. 3.
The application immediately competes with players such as Square and Duluth-based NCR, which unveiled this year a similar platform it calls Silver. San Francisco-based Square, for instance, has more than 40,000 businesses and individuals accepting payments through its system in metro Atlanta.
“This space is evolving very quickly,” said Tom Bell, the CEO of Bank of America Merchant Services. “The influence and emergence of smart phones and tablets … is driving innovation.”
Though devices are targeted to smaller businesses and nonprofits to allow them to accept payments on the go, larger companies also are taking notice, Bell said. The company, he said, has been in discussions with large retailers — including some in Atlanta — about adapting the technology to traditional brick-and-mortar stores.
Bank of America Merchant Services processes 13.5 billion transactions each year for more than 300,000 merchants.
The mobile payment system, under development for about two years, encrypts data from each purchase and does not store account numbers on the device, Bell said.
The system charges merchants for each card swipe, but it has no annual or monthly fees. As a perk, the bank said merchants can enroll in a program and send discounts and offers to Bank of America’s online banking customers.
