It has been said that by 2014, there will be more smart phones than personal computers in the world. The smart phone will reshape the way we perform our everyday tasks, including the way we do our banking. Over the next couple of years, the development of the “virtual wallet” will make its way into your pocket, and you can rid yourself of that bulky billfold. Your phone will be the replacement. Banks have already started with that process. From your phone, you are now able to do all of your banking. PNC Bank has developed a checking account appropriately called the “virtual wallet”. The premise of this account is for all transactions to be done via computer or smart phone. You have the ability to do transfers, keep track of transaction history, and check your balance. Other banks even give you the option to deposit checks by simply taking a photo from your smart phone.
In some countries we are also seeing the phone being used as a credit or debit card. Mobile phones are already being used for payments in
Europe and Japan. We have also seen the mobile phone being used as a credit card processing machine. I was in the Apple store buying a cover for my Iphone, and as I went to go pay, the customer service person helping me asked, “How would you like to pay, cash or credit?” I told her credit, she took out her Iphone and swiped my card right there. I also came across an article there about Square, a mobile payment processing company founded by Jack Dorsey the founder of Twitter. Square is now processing over a million dollars a week. There are several companies already working on developing this technology in the US. In the past we have seen how the evolution in technology can take things that are a staple like 8-tracks to cassette tapes and CD’s to MP-3s. The smart phone is taking that evolution to a completely different level.
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Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.