Waiting for Wireless Payments
By Justin Ried, Mon Sep 01 10:45:00 GMT 2003
Jeff Goldman writes: "China is waiting for a payment method to enable e-business. Could mobile phones be the answer?"
In a recent issue of The Economist, an excellent article about Dangdang.com quotes the site's founder as saying her biggest obstacle to success lies with payment processing. The web site is the Chinese equivalent of Amazon.com, but it's crippled by the fact that only about ten percent of the site's customers have credit cards: it's hard to extol the virtues of buying online when you have to pay for your purchase by sending a check through the mail.
An older article in CIO Magazine discussed China and credits cards in further detail, pointing out that China presents unique challenges to companies that are accustomed to accepting credit cards for payment. Government regulation, standardization issues, and the virtual nonexistence of credit card use throughout the country all compel companies to look to other solutions for payment processing.
Mobile phones could be the answer. Since there are already over 220 million mobile phone users in China, the mobile phone could be the perfect processing point for online payments. "My dream is for mobile phones to work like credit cards," says the site's founder. It would certainly be an ideal solution for Dangdang.com: what other companies are waiting in the wings for this kind of offering to tap their true potential?