PARIS–Visa Inc. is making mobile payments a standard feature offering for its partner banks by moving into commercialization with a system it has been testing with four of the largest U.S. issuers.

The payments network announced Dec. 7 at the Cartes & IDentification conference here that it is making the system, which involves consumers inserting a microSD card into their phone’s memory slot, available to its issuing banks on a commercial basis.

“In addition to issuing plastic magnetic stripe or chip-enabled payment cards, financial institutions can now consider offering their accountholders a new technology that enables them to transform their existing phones into fully functional mobile payment devices,” Bill Gajda, Visa head of mobile, said in a press release.

Visa has been developing and testing the system for the past 18 months with DeviceFidelity Inc., a Richardson, Texas-based company whose In2Pay microSD chip helps power the system (see story). 

Visa previously disclosed that Bank of America Corp., U.S. Bancorp, JPMorgan Chase & Co. and Wells Fargo & Co. have been testing the service (see story).

Participating banks can issue the microSD cards containing the customer’s account information.

“Now the banks that are interested in testing it, piloting it or even going to market have basically a straight shot from a Visa rules perspective,” Dave Wentker, Visa head of mobile development, said in an interview at Cartes.

The company has seen interest in the technology from large and small financial institutions, Wentker said.

Wells Fargo on Dec. 7 said its pilot involves 200 of the San Francisco-based banking company’s employees using certain Research in Motion Ltd. BlackBerry and Apple Inc. iPhone models. Participants launch Wells’ mobile-banking application, which has Visa’s payWave contactless specifications integrated into it, on their phones to transact with their devices. They then wave the phone by a merchant’s contactless reader, similar to using a contactless credit or debit card.

In the case of Wells Fargo, participants may load up to one Visa-branded credit card and debit card to the app.

The service will help “our customers conduct their financial transactions when, where and how they want, ”Peter Ho, Wells product manager for card services and consumer lending, noted in a press release.

A demo of three of the four issuers’ apps at Visa’s booth shows how they are taking different approaches to deploying the system.

Wells Fargo is testing using its existing mobile-banking application, but BofA is piloting the technology with an app separate from its existing mobile-banking application.

Visa’s technology is compatible with the BlackBerry Bold 9650, the iPhone 4, 3GS and 3D models, and the Samsung Vibrant Galaxy 5, which uses Google Inc.’s Android operating system. It plans to add additional handsets, including those running on the Symbian and Windows Mobile operating systems.

IPhone customers must use special cases that can hold DeviceFidelity’s In2Pay microSD card because the phones not have an external memory slot.

Using a microSD card gets around some of the challenges faced by other approaches, including those that hinge on embedding Near Field Communication chips inside of phones, Deepak Jain, DeviceFidelity president and CEO, said during a Dec. 7 Cartes presentation. It works with most major phone types and is compatible with major mobile operating systems, he said.

It “is not scaring anybody in terms of a new device,” Jain said. “It’s really the same chip-and-PIN device that’s out there in a different form.”

Visa’s announcement is one of several mobile-payments initiatives being announced at Cartes. MasterCard Worldwide on Dec. 7 said it and partners Gemalto NV, GarantiBank and Avea, a subsidiary of telecommunication company Turk Telekomunikasyon AS, had made a mobile-payments system involving a SIM card commercially available in Turkey. The SIM card includes a flexible NFC antenna.  

The approach is applicable to the U.S., Ed McLaughlin, MasterCard global head of emerging products, said at Cartes.

Ajay Banga, MasterCard president and CEO, said during the company’s earnings conference call in November that it plans to expand its mobile-payments trials in next year’s first quarter by testing a microSD card approach with a large U.S. issuer (see story).

Industry analysts have said the microSD approach should further help consumers grow more comfortable with using their mobile phones as a financial tool. However, it is likely to serve as a temporary approach between mobile contactless payment stickers consumer can affix to the back of phones and phones that come embedded with NFC chips, which experts view as the end goal. 

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