With many of its legal questions and organizational issues addressed, the Merchant Customer Exchange has turned its focus to the technology that will drive its mobile commerce initiative.

The Merchant Customer Exchange, or MCX, was unveiled in August last year, about four months after Target Corp. and Wal-Mart Stores Inc. announced their intention to join with other merchants to create their own payments system.

Though the venture has been vocal about its motivations and the needs it seeks to address, it has yet to offer or publicly test a product.

"It's definitely moving along, and development of a mobile app is underway," says MCX spokesman Jeremy Mullman. "MCX is not just words on paper, things are happening."

Currently, MCX members are attempting to lure more merchants, while preparing a strategy that could quickly build scale.

"We have added quite a few merchants since our last announcements, so at least 30 merchants are now involved in MCX, plus some who want to stay in the background for now," Mullman says.

MCX members follow strict non-disclosure rules, says Steve Mott, principal of BetterBuyDesign, a Stamford, Conn.-based consulting firm. Mott worked as a consultant with the merchants during the first few months of development, but has not been directly involved with the merchants since MCX's August unveiling.

MCX has three big "planks" – a common experience for the customer, control of the merchant data, and a system that lowers the costs of accepting credit card payments, Mott says.

"Mostly, the merchants are looking to create a different kind of payments paradigm because the current system for them has consumers subsidized by banks and interchange fees that have no relationship to actual costs," Mott says.

A lot of the merchants view this as the first time in 40 years that they can change how people look at costs and who pays for card acceptance, he adds.

Mott's explanation of MCX is "a fair way to summarize" its goals, Mullman says.

"We can't express how important the common customer experience is to all of this," Mullman says. "Right now, a customer may have 20 different platforms to choose from for mobile payments, and it gets very confusing."

Though he could not disclose specific details at this time, Mullman says MCX will make announcements about new members and future plans in the coming months.

That could be good news for merchants, says Mark Horwedel, CEO of the Fayetteville, Ark.-based Merchant Advisory Group.

"Early on, I encouraged many merchants to look closely at MCX and I continue to believe it represents the only mobile initiative that is likely to successfully address those three key issues," Horwedel says.

Many times, industry players have successfully changed consumer behavior, Horwedel says. These changes stem from products such as credit cards, ATMs and debit cards, he says.

"I believe mobile commerce will likely occur when major stakeholders work together to encourage change," he adds.

Mott says the core issue for merchants likely remains the tug of war over control of transaction and consumer data.

"Currently, the banks, merchants and card networks have certain data, but there is no sharing," Mott says.

When a mobile provider becomes a key player, as is the case with Google, the providers are able to see all of the critical data, Mott says. "And that is extremely worrisome for merchants and consumer advocates," he adds.

Consumers will eventually embrace mobile commerce if it becomes easier to understand and initiate, which is what MCX is hoping to accomplish, Mott says.

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