Earlier this week, over a dozen of the biggest retailers in America announced a joint venture to create a mobile payment network. Wal-Mart (WMT), Target (TGT), Sunoco (SUN) and 7-Eleven plan to join forces and create a common platform to support purchases via smartphones and other devices.
The news comes on the heels of Starbucks' (SBUX) investment in Square, a start-up payment system already being used in New York City cabs. Users of Android devices have been able to use an offering from Google (GOOG) Wallet and there's a collaboration between major mobile carriers to create their own network that will be called Isis.
According to Wall Street Journal reporter Robin Sidel, the way you're going to pay in the future is set in stone. Throw out your credit card and even your wallet. Just enter your information into your phone and tap it on the reader at the cash register.
Ultimately the nascent partnership between the retailers may amount to nothing unless there's a standardized payment system for every merchant and smartphone.
"You really need one platform," Sidel says in the attached video. "People don't want so many choices that they don't know what they're doing at the register."
Don't burn your cash just yet. The elephant in the room is security. Phones get lost constantly and a four-digit pass code is easily cracked by any hacker worth his salt. The prospect of leaving access to your entire bank account sitting in the back of a cab is frightening enough to keep many consumers from adopting mobile pay anytime soon.
"It took 50 years for plastic to overtake cash and checks, so who knows?" says Sidel.