Zimbabwe-based banking software provider Edgetech Solutions has begun testing EdgePay, a payment system that uses sound waves to provide added security at the point of sale.
The EdgePay application works on Android and iOS devices through technology created by NearBytes, which is based in Brazil. Edgetech plans to test the application while seeking local banks in Zimbabwe to participate.
Several banks have already shown an interest in the system and Edgetech plans to begin deployments through financial institutions within the next few weeks, Wilson Tawodzera, Edgetech Consultancy's managing director, states in a press release.
"Sound can do so much more in the hands of forward-thinking people," Tawodzera says.
The application interfaces for NearBytes are "quite straightforward and easy to use," he adds.
Participating banks would make an Edgetech POS terminal available to merchants, enabling acceptance of an EdgePay payment through an integrated app, microphone and speaker. The consumer does not need a Near Field Communication chip or bar code capabilities. However, the terminal has an NFC reader and can also accept EMV-chip or magnetic-stripe card transactions.
EdgePay users would open the app on their smartphones and place it next to the terminal, which transmits details of the transaction to the handset through sound. The user enters a PIN prior to sending back the one-time audio password to confirm the transaction.
The POS terminal sends the transaction information to the bank for processing and prints a receipt for the customer. Neither the POS terminal nor the phone would retain any consumer account data.
"We expect this product to be quite popular, because the use of sound to transfer data does not require special hardware apart from a speaker and microphone," Tawodzera says in the release. "Banks have been eagerly waiting for a way to utilize the mobile phones to make payments across different platforms."
Mobile payments and data transmission through sound are likely to have appeal in developing markets like Zimbabwe, says Richard Oglesby, senior analyst at Double Diamond Payments Research.
"Zimbabwe probably doesn't have a whole lot of pre-existing infrastructure that you'd have to replace," Oglesby says. "Closed-loop applications using this technology make sense."
But widespread adoption of sound technology, especially in the U.S., is not likely to occur because NFC infrastructure will eventually expand as EMV cards become the norm, Oglesby says.
"For a while, I thought sound technology might have a mass appeal, especially when VeriFone acquired the technology, but they haven't done a whole lot with it other than using it in taxi cabs," he adds.
Nearly a year ago, VeriFone Systems Inc. launched its sound-based Zoosh technology through the Way2Ride mobile app for taxi riders, allowing payments through the speakers and microphones of smartphones.
The Way2Ride app uses a consumer's linked payment card and pre-set tipping preference, allowing riders to leave the taxi as soon as the ride ends.
Various other companies have tested both light and sound for mobile payment transactions, including Clinkle in the U.S. Early in 2013, Alipay introduced a person-to-person payment system using audio signals, and shopkick has long used audio signals with its mobile rewards app.