Visa to bring digital wallet to US banks

Visa is planning to launch a digital wallet for online and mobile payments for US banks this year.

The wallet will replace traditional credit and debit cards for many people, as payments will be entirely digital. The service will work online by letting users click a single button instead of entering all of their account details each time, but Visa has not revealed how it will do this without compromising security.

The banks that have so far signed up to the plan include US Bancorp, PNC Financial Services, Regions Financial, BB&T Corp, TD Bank and Barclays PLC.

Jim McCarthy, head of global products at Visa, told Reuters that mobile payments will predominantly take off in the form of people buying things online through their smartphone, but the company is still looking at Near Fields Communications (NFC) and other technologies for using phones to buy things in brick and mortar stores.

The mobile payments industry is set to boom big time over the next few years, with most of the major smartphone players implementing NFC capability into their upcoming product ranges. Google added the feature into its Android 2.3.3 release and there were frequent rumours that Apple was working on the technology for the iPhone 5, but recent reports suggest otherwise.

Visa is also trialing a separate mobile payment system with Bank of America and other major banks during the Summer.

The digital wallet will initially launch in the US and Canada in Autumn of this year. There's no word yet on a European release, but we expect that will come some time in 2012.