It is hard to imagine that not long ago computers were human. The word’s original meaning was literally a person that solved equations, using a mechanical calculator. Companies employed these large metal structures to do number crunching, and serve as a data center mainframe. Now they are disappearing all together, technology shifts to meet the demands of today’s society, submitting to various mutations as the years pass.
The original computer platform, referred to as the mainframe, has been ousted by minicomputers, giving way to the personal computers, now being offset by hand held devices with Smartphone architecture, completely disrupting the computing structure through this sequence. Computing is taking on yet another role, becoming more centralized, turning into a “cloud”, incorporeal and exploited when and where it is required.
The establishment of this cloud is more than a platform shift; indisputably modifying the information technology industry to such an extent that the way people work and companies function, will allow digital technology to infiltrate every niche of the economy and of society. This is not some technological nirvana that the IT industry is using to concoct new buzzwords to keep people interested, but instead a rampant term that has spread avariciously. Cloud conferences, cloud blogs are such an obsession that it may have peaked already. Gartner, a research firm, claims that cloud computing will transgress through a “trough of disillusionment”, entailing a stage in which the hype cycle of technology will fail to meet the expectations of consumers. However, the possibility of the term may already seem passé; but the cloud is going to continue to grow from an amalgamation of cut-rate power processors with ubiquitous networks. Data centers become factories delivering computer services as an online service with wireless networks connecting to such software. This disaggregates computing into component services, turning into an “internet of things” used by billions of different devices. With financial institutions creating computing grids, they will be able to link software as a service over the internet. Such computing cloud operators like Amazon and Google engage in this IT system. However, it seems that all firms will soon have no choice but to switch their infrastructure as well.
In my mind, cloud computing is just a service oriented architecture that companies have been flirting with for quite some time. The main issues at hand are dealing with the security of information. Firms essentially trust their second most valuable currency, data, in the hopes that it has not replicated or outsourced to entities that they do not want that privilege extended. The article says that companies will not be able to link service to the enterprise firms due to the security issues and conformity compliances that it faces, but firms already use their most valuable currency, money, to cloud computing services such as banking. People put trust into banks hoping that they keep an eye on their money. This same trust needs to be instilled by the Googles, Amazons, telco’s, etc. This notion is not impossible, but it is an action that needs to be taken care of before large firms buy in. For now, you will not have to bid farewell to a data center that models a raised floor, cooling data center for its IT department, until a reliable cloud model ascends.
"Let it Rise." Economist.com. 23 Oct. 2008. http://www.economist.com/specialreports/displaystory.cfm?story_id=12411882.
Tuesday, November 4, 2008
Next Generation Asset Management
Next-Generation Asset Management
Evolution To Becoming All-Inclusive
by Joe Rudich
PROCESSOR: February 29, 2008 • Vol.30 Issue 9
http://www.processor.com/editorial/article.asp?article=articles%2Fp3009%2F33p09%2F33p09.asp
According to Wikipedia IT asset management (ITAM) is a way of combining business practices that join financial, contractual and inventory functions to support life cycle management and strategic decision making for the IT environment. Meaning, what would be cost effective and important when creating/ retireing IT. This definition is important to better understand what changes the article is calling for.
IT services have become a corner stone in today’s business environment. The article states that usual idea of IT is that it is the “cost center of a company.” but according to Dennis Drogseth, vice president of EMA (Enterprise Management Associates), managers need to change their minds and see that IT is a necessary internal provider of the critical services a business needs to exist.
One key element is to turn IT asset management into a way to measure the true value of what services are provided, and not just the cost of the components that are used to create the IT. Showing this value requires accounting for cost and performance and will require, what EMA calls “next-generation asset management”. NGAM is to offer a way to move away from current “cost center” ideal and include quality, cost and demand of IT in the business.
NGAM is a way to create a foundation for IT planning, choosing the best way to invest based on complete knowledge of assets, not just the tangible aspects normally affiliated with IT, but on true current needs of the business. NGAM allows a way to monitor the actual cost for running and creating IT. This combines with management disciplines, service accounting, telecommunications and resource management. This change will require new organizational, process, and political models for NGAM to be viable. The old IT asset management models will have to be removed and new ones will have to take their place.
In essence, this article is a new generation of IT asset management, ITAM, which takes into account the physical costs of IT but intangible areas which are not measured by the current finical ideals. In a way, it’s about putting the cost of creating, using and retiring IT into the total costs of creating IT. This is a service asset management companies are working toward for companies to take into account the full costs to a company to create a greater measurable cost analysis to help companies and their bottom lines.
This will allow companies to create new programs and services the most cost effective way. By expanding the variables of cost, a better model of cost attribution is created. This utilization of cost could allow for the company to realize the correct price to charge for a service or if creating and implementing a program would actually be detrimental to the company.
These changes make sense, while they do call for a long and tedious process to occur; in the long run the closer cost is defined and realized the greater the ability to run and manage the company would occur.
cite for wikipedia:
Wikipedia contributors, "IT asset management," Wikipedia, The Free Encyclopedia, http://en.wikipedia.org/w/index.php?title=IT_asset_management&oldid=249709786 (accessed November 5, 2008).
Evolution To Becoming All-Inclusive
by Joe Rudich
PROCESSOR: February 29, 2008 • Vol.30 Issue 9
http://www.processor.com/editorial/article.asp?article=articles%2Fp3009%2F33p09%2F33p09.asp
According to Wikipedia IT asset management (ITAM) is a way of combining business practices that join financial, contractual and inventory functions to support life cycle management and strategic decision making for the IT environment. Meaning, what would be cost effective and important when creating/ retireing IT. This definition is important to better understand what changes the article is calling for.
IT services have become a corner stone in today’s business environment. The article states that usual idea of IT is that it is the “cost center of a company.” but according to Dennis Drogseth, vice president of EMA (Enterprise Management Associates), managers need to change their minds and see that IT is a necessary internal provider of the critical services a business needs to exist.
One key element is to turn IT asset management into a way to measure the true value of what services are provided, and not just the cost of the components that are used to create the IT. Showing this value requires accounting for cost and performance and will require, what EMA calls “next-generation asset management”. NGAM is to offer a way to move away from current “cost center” ideal and include quality, cost and demand of IT in the business.
NGAM is a way to create a foundation for IT planning, choosing the best way to invest based on complete knowledge of assets, not just the tangible aspects normally affiliated with IT, but on true current needs of the business. NGAM allows a way to monitor the actual cost for running and creating IT. This combines with management disciplines, service accounting, telecommunications and resource management. This change will require new organizational, process, and political models for NGAM to be viable. The old IT asset management models will have to be removed and new ones will have to take their place.
In essence, this article is a new generation of IT asset management, ITAM, which takes into account the physical costs of IT but intangible areas which are not measured by the current finical ideals. In a way, it’s about putting the cost of creating, using and retiring IT into the total costs of creating IT. This is a service asset management companies are working toward for companies to take into account the full costs to a company to create a greater measurable cost analysis to help companies and their bottom lines.
This will allow companies to create new programs and services the most cost effective way. By expanding the variables of cost, a better model of cost attribution is created. This utilization of cost could allow for the company to realize the correct price to charge for a service or if creating and implementing a program would actually be detrimental to the company.
These changes make sense, while they do call for a long and tedious process to occur; in the long run the closer cost is defined and realized the greater the ability to run and manage the company would occur.
cite for wikipedia:
Wikipedia contributors, "IT asset management," Wikipedia, The Free Encyclopedia, http://en.wikipedia.org/w/index.php?title=IT_asset_management&oldid=249709786 (accessed November 5, 2008).
Monday, November 3, 2008
Why the mobile bank in US is less popular than Japan?
With the development of the technology, the Mobile bank is one of the most potential functions in the commercial bank system now. However, as the article “mobilebankerscan” argued, many drawbacks of the Mobile Bank need to be improved, and the core one is the security of the mobile bank. But does it really the security problem of the mobile bank made both the consumers and the banks reluctant to use and develop its potential to full as the article “mobile banker scan”mentioned and keep the mobile bank less popular than the Japan or India? In my view the sink cost of the American banks had invested in, difference in culture, and lacking a global vision result in such an awkward situation of the American mobile bank system
First thing first, as the author of the article “Mobile Insecurity: Reality or Just hype?” said, two mainly threats, hacker and stolen of the cell phone, lift their hand against the Scalability & Reliability of the mobile bank. Not only him, had some experts also said that “Technical hurdles, security concerns and lack of merchant acceptance may keep mobile payment from mainstream consumer acceptance.” [1] Does this really make sense? In my view, the technology to steal the information of the mobile bank customer is more complicated than that of steal the information of the Internet bank customer, even more hard than to steal the information of the tradition credit card. (The cost of tradition credit card fraud is high; in the UK in 2004 it was over £500 million [2]). If so, the chance of mobile bank fraud should no larger than that of Internet bank fraud. Or why this security problem does not stop the popularization of mobile bank in Japan?
I think the mainly reasons are that unlike Japan, US has already developed such a completed widespread and convenient retail bank system which satisfied the consumer most. As a well-developed market, the cost of the tradition payment methods, debit and credit, has been accumulated with the building up of the numerous Auto Teller Machine, the transaction machine and the branches in different areas. Moreover, the payment method of Mobile bank is quite different from other E-bank method, Internet Bank, because the Internet Bank could never take the place of the tradition credit/debit card as a useful tool of daily consumption. The larger the sink cost is, the more reluctant the bank wants to change. Moreover, the transaction system is connected, so if any one of the bank want to change the payment methods, all the bank need to adopt a new kind of machine to adopt this method, which quite a large project is to reached an agreement among all the banks. So the first-mover of adopting a large scale of mobile payment methods was impeded by the huge sink cost of tradition payment methods. However, if all the banks reach an agreement to adopt the newly methods, the pattern of every bank’ market share would not change because the consumer could do the same things with their original bank. Moreover, unlike the Japanese and Indian, the American likes to spend money in the future but not save money. The payment methods of different banks need to become a system so it can attract the consumers. But in Japan, the people there like to save money, the interest rate of Japanese bank always negative in the last 10 years. And also, draw from an article “Generally, credit cards in Japan are used for a smaller share of transactions, with a higher average amount, and with less borrowing per transaction.” (Credit Cards and Debit Cards in the United States and Japan; Ronald J. Mann ; Vanderbit Law Review, Vol. 55, p. 1055, 2002). So the Scalability & Reliability would never be so developed as American here. And according a report, the sense of responsibility the Japanese companies hold are much stronger than companies in American. Always a Japanese company more focus on service the whole society but not how many profit the company earn.
The reasons above led to less-motive of American Bank willing to change the pattern of the market. However, as far as I am concerned, even though the mobile banking could hardly lift revenue of the American Banks up to a new stage, it could serve as a useful tool for the company to seeking global opportunities. When the commercial bank is about to enter a foreign market, one of its disadvantage is that it is impossible to build the same numbers of branches in that country as the local commercial bank did. But if the commercial bank hold a sane security and have a good reputation in its own market, these two things will make the globalization real. What the company needs to do is work with local telecom serve to build an advanced transaction system. Anyway, the cost of building such a system is far less than that of hiring clerk and renting office. Moreover, when the new payment method changes the local customer’s behavior, the bank could set up a “first-move” advantage and force the local competitors follow his standard.
[1] http://www.americanbanker.com/mobilebankerscan.htm
[2] http://en.wikipedia.org/wiki/Credit_card
Posted by FengGuo
Article:
"Mobile Insecurity: Reality or Just hype?"
http:http://www.americanbanker.com/btn_article.html?id=20081028BX7G0X2H
"mobilebankerscan"
http://www.americanbanker.com/mobilebankerscan.html
First thing first, as the author of the article “Mobile Insecurity: Reality or Just hype?” said, two mainly threats, hacker and stolen of the cell phone, lift their hand against the Scalability & Reliability of the mobile bank. Not only him, had some experts also said that “Technical hurdles, security concerns and lack of merchant acceptance may keep mobile payment from mainstream consumer acceptance.” [1] Does this really make sense? In my view, the technology to steal the information of the mobile bank customer is more complicated than that of steal the information of the Internet bank customer, even more hard than to steal the information of the tradition credit card. (The cost of tradition credit card fraud is high; in the UK in 2004 it was over £500 million [2]). If so, the chance of mobile bank fraud should no larger than that of Internet bank fraud. Or why this security problem does not stop the popularization of mobile bank in Japan?
I think the mainly reasons are that unlike Japan, US has already developed such a completed widespread and convenient retail bank system which satisfied the consumer most. As a well-developed market, the cost of the tradition payment methods, debit and credit, has been accumulated with the building up of the numerous Auto Teller Machine, the transaction machine and the branches in different areas. Moreover, the payment method of Mobile bank is quite different from other E-bank method, Internet Bank, because the Internet Bank could never take the place of the tradition credit/debit card as a useful tool of daily consumption. The larger the sink cost is, the more reluctant the bank wants to change. Moreover, the transaction system is connected, so if any one of the bank want to change the payment methods, all the bank need to adopt a new kind of machine to adopt this method, which quite a large project is to reached an agreement among all the banks. So the first-mover of adopting a large scale of mobile payment methods was impeded by the huge sink cost of tradition payment methods. However, if all the banks reach an agreement to adopt the newly methods, the pattern of every bank’ market share would not change because the consumer could do the same things with their original bank. Moreover, unlike the Japanese and Indian, the American likes to spend money in the future but not save money. The payment methods of different banks need to become a system so it can attract the consumers. But in Japan, the people there like to save money, the interest rate of Japanese bank always negative in the last 10 years. And also, draw from an article “Generally, credit cards in Japan are used for a smaller share of transactions, with a higher average amount, and with less borrowing per transaction.” (Credit Cards and Debit Cards in the United States and Japan; Ronald J. Mann ; Vanderbit Law Review, Vol. 55, p. 1055, 2002). So the Scalability & Reliability would never be so developed as American here. And according a report, the sense of responsibility the Japanese companies hold are much stronger than companies in American. Always a Japanese company more focus on service the whole society but not how many profit the company earn.
The reasons above led to less-motive of American Bank willing to change the pattern of the market. However, as far as I am concerned, even though the mobile banking could hardly lift revenue of the American Banks up to a new stage, it could serve as a useful tool for the company to seeking global opportunities. When the commercial bank is about to enter a foreign market, one of its disadvantage is that it is impossible to build the same numbers of branches in that country as the local commercial bank did. But if the commercial bank hold a sane security and have a good reputation in its own market, these two things will make the globalization real. What the company needs to do is work with local telecom serve to build an advanced transaction system. Anyway, the cost of building such a system is far less than that of hiring clerk and renting office. Moreover, when the new payment method changes the local customer’s behavior, the bank could set up a “first-move” advantage and force the local competitors follow his standard.
[1] http://www.americanbanker.com/mobilebankerscan.htm
[2] http://en.wikipedia.org/wiki/Credit_card
Posted by FengGuo
Article:
"Mobile Insecurity: Reality or Just hype?"
http:http://www.americanbanker.com/btn_article.html?id=20081028BX7G0X2H
"mobilebankerscan"
http://www.americanbanker.com/mobilebankerscan.html
Personal Financial Management Systems
I have chosen to look at personal finance applications and their future as centralized tools for consumers. As we found in class, it is now expected that consumer-banking products come with an array of online tools that give customers 24/7 access to their account information such as balances, and maybe even bill-pay abilities. While these are welcome advances to today’s mobile-minded consumers, some of us want more from these services. Where are the centralized portals where I can view all of my account information for various financial instruments? What about budgeting tools along with bill pay? The Internet is full of dynamically generated content and there are already forecasting and prediction tools out there, why not incorporate this into my finances?
There are several financial management sites that have begun addressing the absence of these features from the websites of our financial institutions. In general, they offer increasing compatibility with various institutions and unique tools to track, monitor, and forecast based on a user’s mix of bank accounts, loans and mortgages, and investments. According to the article from American Banker, these companies are each finding their own individual niches to appeal to with a different set of features.
Intuit has just removed the subscription cost for its service and has recently added spending management features designed for low-income consumers. Mint is attempting to appeal to consumers with more “sophisticated banking needs” by adding investment tracking and retirement account access to their existing services. Geezeo is expanding from its college student focus by creating community tools revolving around financial habits.
As each targets a different demographic, all of these online financial management sites share one crucial attribute: each of them offers their solutions for no cost to the user. Intuit, the highly recognized name in the personal finance market, was relatively unsuccessful in porting their Quicken software to the Internet in terms of obtaining a viable customer base at first. A spokesman for the company is cited in the article as saying, “We dropped the ball with Quicken Online… [the monthly fee] was an obstacle for people to enter.” They’ve reevaluated their target customer and acknowledged that the most likely users of the online software are not the same as those using the original Quicken. To compete with this, Mint and other companies make money by recommending financial products to users and getting referral fees from banks.
The playing field is level and the management sites are left creating features to segment and position themselves for the future. As personal finance tools, compatibility with a broader range of banks and lenders, and consumer trust for security measures of such products go up, the sites may find that banks seek their services as part of their own online packages in the future.
Daniel Wolfe. "Financial Web Site Operators Increasing Focus on Niches. " American Banker [New York, N.Y.] 20 Oct. 2008,8. Accounting & Tax Periodicals. ProQuest. American University. 2 Nov. 2008
Financial Foot Soldiers, Feeling the World’s Weight
OK- I could not resist getting into the class blog with a posting. Monday, Nov 3rds New York Times columnist, Dan Barry, goes behind the scenes with NYSE Floor Brokers. Learn about how their jobs have changed: information technology, 9/11 and the current tumult in the markets can make the day, well, a little lonely. What I suspect many of you will find interesting, is the educational level of these workers. These are not newly minted college graduates. These men (yes, still mostly men) rose up from the running positions at the broker firms. This is not your nattily dressed banker but the folks who can "feel" the market. Just think about how much we discussed program trading, decision modeling. These tough guys are really the touchy-feely folks on Wall St.
Financial Foot Soldiers, Feeling the World's Weight by Dan Barry; New York Times 11/3/2008
Financial Foot Soldiers, Feeling the World's Weight by Dan Barry; New York Times 11/3/2008
Personal-Finance Software goes lite?
Nowadays, as the technologies develop so fast, usage of advanced Personal-finance software should have grown to make people manage their money better and easier.
However, since Quicken Software, which Intuit’s Quicken is founded on, no longer contributes 10% to the company’s revenues, Intuit’s Quicken is shifting its resources from its Quicken software to its Web-based Quicken Online. Also, Microsoft, which was a leader in the field of personal-finance software, recently pulled its Money Software from retail channels in favor of online sales only.
Why? There are a couple of reasons.
First, as the article mentioned, market and industry changes are quickly rendering existing products and services obsolete. Set recent finance crisis as an example. The break out of the finance crisis brings great tremendous changes to almost all the markets and industries. It will also certainly bring many influences on people’s money management. Although software companies know that the tools they setup with the software to give advice on people’s investments are turning useless, it is extremely hard to figure out more useful tools, as who knows what will happen in such destructive finance crisis.
Secondly, the technologies applied in the personal-finance software become more and more common. As personal-finance service is still at the early stage of its life cycle and relatively low cost to have related technologies, many companies will try to enter this market. Increasing competition will make personal-finance software less profitable. Actually, Intuit’s Quicken software has become just a landing pad to send customer to more profitable offerings like TurboTax.
Thirdly, few new functions have been generated. When the personal-finance software came up, it really help people, who do not have such tools before, a lot with its basic functions. A decade has passed, although many usability and features were added to the product, few of them seemed useful. It will be a big problem for its product to attract new-use people and maintain payments of former purchaser without significant advancement.
Additionally, recent weak economy cannot be ignored as an important environment factor.
In fact, Intuit’s Quicken is not the only company which is facing this problem, Rudder, Mint, and other personal-finance product providers are in the same situation as Intuit’s Quicken.
But on the other hand, personal-finance software still has some advantages, which developed well will benefit its sales.
Compared to the same kind online services, software will present a more secure-condition in terms of steady operation and safety of password.
Also, it can provide all the available information updated to when you use it online last time when there is no access to Internet. It will become quite useful in some time.
The article is available at http://online.barrons.com/article/SB122488830513468381.html
However, since Quicken Software, which Intuit’s Quicken is founded on, no longer contributes 10% to the company’s revenues, Intuit’s Quicken is shifting its resources from its Quicken software to its Web-based Quicken Online. Also, Microsoft, which was a leader in the field of personal-finance software, recently pulled its Money Software from retail channels in favor of online sales only.
Why? There are a couple of reasons.
First, as the article mentioned, market and industry changes are quickly rendering existing products and services obsolete. Set recent finance crisis as an example. The break out of the finance crisis brings great tremendous changes to almost all the markets and industries. It will also certainly bring many influences on people’s money management. Although software companies know that the tools they setup with the software to give advice on people’s investments are turning useless, it is extremely hard to figure out more useful tools, as who knows what will happen in such destructive finance crisis.
Secondly, the technologies applied in the personal-finance software become more and more common. As personal-finance service is still at the early stage of its life cycle and relatively low cost to have related technologies, many companies will try to enter this market. Increasing competition will make personal-finance software less profitable. Actually, Intuit’s Quicken software has become just a landing pad to send customer to more profitable offerings like TurboTax.
Thirdly, few new functions have been generated. When the personal-finance software came up, it really help people, who do not have such tools before, a lot with its basic functions. A decade has passed, although many usability and features were added to the product, few of them seemed useful. It will be a big problem for its product to attract new-use people and maintain payments of former purchaser without significant advancement.
Additionally, recent weak economy cannot be ignored as an important environment factor.
In fact, Intuit’s Quicken is not the only company which is facing this problem, Rudder, Mint, and other personal-finance product providers are in the same situation as Intuit’s Quicken.
But on the other hand, personal-finance software still has some advantages, which developed well will benefit its sales.
Compared to the same kind online services, software will present a more secure-condition in terms of steady operation and safety of password.
Also, it can provide all the available information updated to when you use it online last time when there is no access to Internet. It will become quite useful in some time.
The article is available at http://online.barrons.com/article/SB122488830513468381.html
Saturday, November 1, 2008
The “Next Generation” of Credit Cards and Banking
Mobile phones will play a significant role in the “Next Generation” of financial services. Who knew when Alexander Graham Bell first invented telephone in 1876 that it would eliminate the need to carry money in peoples’ wallets? It is astonishing how the technology has emerged to shrink the needs of a traditional bank for customers to do their transactions.
The concept to carry less money in peoples’ wallets started to emerge when credit cards first came into the market during 1920s. Later, the invention of smart cards took the credit card payments into the next level. Today, smart cards have gone through a radical change, and now been used for everything from credit cards, paying bus fares, entering secure building, borrowing from libraries etc. The most common smart card applications includes Credit cards , Electronic cash, Computer security systems, Wireless communication, Loyalty systems Banking, Satellite TV, Government identification etc. Financial institutions have been adopting the smart card technology aggressively. These activities include, but not limited to, credit cards, debit cards, corporate cards etc. Major credit card companies such as American Express, Visa, and MasterCard have their own smart card technology built into their credit/debit cards. This includes Express Pay from American Express, Contactless from Visa, Paypass from MasterCard etc.
Now the concept of digital money is about to make the next revolutionary change from smart cards into mobile phones. The leading credit card company, that operates world's largest retail electronic payment network, is planning to work with Nokia, the world’s leading phone manufacture, to build a mobile phone that takes financial transactions into the next level. Tim Attinger, Head of Global Product Innovation at Visa Inc, says "Mobile payments and services are one of the most vibrant areas of innovation at Visa, as we seek to accelerate the migration from paper forms of payment to digital money". He also maintains the view that "Visa is already better money - more convenient, reliable and secure than cash.
This new invention would allow the customers to use their mobile phones “to pay for goods and services; initiate mobile money transfers to other individuals with Visa accounts; receive near real-time notifications of activity on their Visa account; and "opt in" to receive offers and discounts from merchants.” This concept would allow the mobile payments a reality for consumers around the globe. Consequently, the “Next Generation” of financial services will be based on the concept of mobile banking. Although this concept may not eliminate the entire baking system, it will definitely shrink the need of a traditional bank for customers to do their banking.
Visa Inc.; Visa and Nokia Working Together to Deliver Payment Applications for Next Generation Mobile Devices. (8 October). Telecommunications Business,320. Retrieved November 1, 2008, from Sciences Module database. (Document ID: 1565706591).
The concept to carry less money in peoples’ wallets started to emerge when credit cards first came into the market during 1920s. Later, the invention of smart cards took the credit card payments into the next level. Today, smart cards have gone through a radical change, and now been used for everything from credit cards, paying bus fares, entering secure building, borrowing from libraries etc. The most common smart card applications includes Credit cards , Electronic cash, Computer security systems, Wireless communication, Loyalty systems Banking, Satellite TV, Government identification etc. Financial institutions have been adopting the smart card technology aggressively. These activities include, but not limited to, credit cards, debit cards, corporate cards etc. Major credit card companies such as American Express, Visa, and MasterCard have their own smart card technology built into their credit/debit cards. This includes Express Pay from American Express, Contactless from Visa, Paypass from MasterCard etc.
Now the concept of digital money is about to make the next revolutionary change from smart cards into mobile phones. The leading credit card company, that operates world's largest retail electronic payment network, is planning to work with Nokia, the world’s leading phone manufacture, to build a mobile phone that takes financial transactions into the next level. Tim Attinger, Head of Global Product Innovation at Visa Inc, says "Mobile payments and services are one of the most vibrant areas of innovation at Visa, as we seek to accelerate the migration from paper forms of payment to digital money". He also maintains the view that "Visa is already better money - more convenient, reliable and secure than cash.
This new invention would allow the customers to use their mobile phones “to pay for goods and services; initiate mobile money transfers to other individuals with Visa accounts; receive near real-time notifications of activity on their Visa account; and "opt in" to receive offers and discounts from merchants.” This concept would allow the mobile payments a reality for consumers around the globe. Consequently, the “Next Generation” of financial services will be based on the concept of mobile banking. Although this concept may not eliminate the entire baking system, it will definitely shrink the need of a traditional bank for customers to do their banking.
Visa Inc.; Visa and Nokia Working Together to Deliver Payment Applications for Next Generation Mobile Devices. (8 October). Telecommunications Business,320. Retrieved November 1, 2008, from Sciences Module database. (Document ID: 1565706591).
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