The twenty-first century saw novel means of payments-mobile payments and payments through

the internet. Mobile payments are money rendered for a product or service through a portable
electronic device, such as a cell phone, smartphone.. or a tablet device. Due to our
ever-increasing smartphone dependence, various ways have been developed to allow consumers
to pay conveniently through a phone. Mobile payment technology can also be used to send
money to friends or family members. Increasingly, services like Apple Pay and Google Pay are
vying for retailers to accept their platforms for point of sale (POS) payments. A point of sale
(POS) is a place, such as a checkout counter of a store, where a customer makes the payment for
goods or services.

The following mobile payments information came from mobiletransaction.org (2021):

Use of near field communication (NFC) payments is growing rapidly in the UK. NFC is the
technology that allows two devices-your phone and a payments terminal-to process contactless
payments. The mobile phones do not have to touch the POS to transfer information (e.g. money),
but they have to be within a few inches of the terminal. NFC phones communicate with
NFC-enabled card machines using close-proximity radio frequency identification. London,
China, and Japan use NFC for busses, tube stations, and public transport. Visitors and residents
in Nice can use NFC to purchase almost anything. Digital wallets using NFC for contactless card
machines include Apple Pay, Samsung Pay, Google Pay, and Android Pay.
Sound wave-based (SWB) or sound signal-based (SSB) mobile payments represent a newer,
cutting-edge solution that works for most mobile phones. Transactions are processed without the
need for internet through unique sound waves containing encrypted data about the payment.
Pay-by-sound uses an advanced, ultra-low power, wireless transmission technology to transmit
data via already using. Any phone with a microphone can pick up those waves to complete a
sound waves that originate from the very same POS terminals that retailers are only functions on
certain phones. Your mobile wallet, banking app, or card termina transaction. No special features
need to be present or enabled-unlike NFC, which just needs a simple software installation. There
is no need for any extra hardware. This makes it an affordable solution especially in areas and
countries where people cannot afford the latest smartphones, but rely on more basic technology
to process payments.
Another way to pay with a mobile phone at a card terminal is through magnetic secure
transmission (MST). Samsung Pay uses both MST and NFC payments for contactless mobile
phone payments. MST is when a phone emits a magnetic signal imitating the magnetic strip on
the payer's credit card, which the card terminal picks up and processes as if a physical card was
swiped through the machine. MST is as secure as NFC, in part because they both use a secure
tokenization system, and it is safer than using a physically present card.
A mobile/digital wallet stores payment information on a mobile device, usually in an app that
utilizes different technologies in the payment process. Mobile/digital wallets using NFC for
contactless card machines include Apple Pay, Samsung Pay, and Google Pay. Digital wallets are
very secure to use. They commonly work through complex encryption and tokenization, a
method using time-limited token numbers generated to process the specific transaction using
your already-encrypted card "stored" in your mobile wallet. Apart from credit and debit cards, it
is also possible to attach loyalty cards, boarding passes, tickets, and other important documents
in mobile wallets.
Quick response (QR) codes are the trademark of a type of matrix barcode (type 2D barcode)
readable by smartphones created in 1994 for the Japanese automotive industry. It has since been
used in many contexts, for instance marketing and information sharing, but it is also a popular
way for people to make mobile payments, especially since the COVID-19 pandemic started. A
QR code has four important advantages:
It stores a large volume of data.
b. It can be scanned from a screen, not just paper.
c. It can be read even if part of the code is damaged.
d. It is safer because information can be encrypted.

Businesses doing e-commerce use QR codes at their website checkout as an alternative to

manually entering card details. This is more secure because your phone, that your card details are
securely connected to, confirms you are the owner of the card. You do not have to type your
unencrypted card details on a device screen.
We also have short message (or messaging) service (SMS), also called premium SMS
payments and direct carrier billing. SMS payments simply mean paying for products or services
via a text message. You send a text message with the relevant information to the right payee
phone number and the payment amount is added to your mobile phone bill.
Direct carrier billing (DCB) is similar to SMS payments because you pay through your mobile
carrier instead of using bank or card details. You enter your phone number on a payment page or
in an app, wherein after you go through a few authentication steps to confirm you are the owner
of that number like confirming a text message, the payment will then be added to your phone bill
or prepaid SIM card as with SMS payments.
Internet payments can be done on desktops, laptops, or even phones (as in mobile payment).
Like mobile payment technology, internet payments can also be used to send money to friends or
family members. There are several ways to pay this way. For instance, you can manually enter
card details on a website to pay for an order (just like on a computer), automatically charge a
bank card attached to a mobile app, or use PayPal or follow a link to a digital invoice emailed to
you. Prior 2010, this was commonly referred to as wireless application protocol (WAP)
payments. WAP used to be the most common facility on smartphones connecting to the internet.
So instead of a web browser with access to the entire internet, people paid through a more
limited-capacity WAP browser or app.
Also, most credit cards and bank accounts have what we call "auto pay," where payments to
credit cards or other bills, like for water, electricity, or whatever bills need to be paid, are
scheduled to be automatically paid on a certain date. from funds of the payee with a certain bank.
It can be the bank doing the auto pay or the credit card company. This is very similar to mobile
banking using an app provided by the user's bank, through which you can conduct financial
transactions (peer-to-peer transfers, payments to other people, and bill payment) directly from
your bank account. This is like using a debit card where funds are immediately deducted from
the cardholder's bank account, but there is no need for the physical card.
We also have what we call payment links or pay by link. It is most commonly social media.
When the receiver clicks the link, a checkout page opens up in referring to a button/link sent in
an email, text message, messaging app, or over an internet browser where the recipient can enter
their card details to process a transaction for a specified merchant. The transaction total can be
set in advance t the merchant sending the link, or in some cases, entered manually by the
recipient. The merchant may itemize the bill, so products are included on the customer's digital
receipt that follows or you may only see a transaction amount with merchant details on the
checkout page.
Lastly, for the technology savvy, we now have what we call neobanks. A neobank literally
means "new bank," from the Greek word neos meaning "new" It is an umbrella term for the new
generation of cutting-edge, fully digital banking services aiming to be more accessible than
traditional banks. They all operate online or through apps; hence, they are classified as a type of
financial technology (fintech) solution. Their services include savings account, current account,
mobile apps, payment cards, money transfers, loans, and even financial services like analytics to
improve spending behaviors.

LESSON SUMMARY
 1. ​ Mobile payments are money rendered for a product or service through a portable
electronic device, such as a cell phone, smartphone, or a tablet device. It can also be used to
send money to friends or family members.

2. ​ Near field communication (NFC) payments is the technology that allows two
devices-your phone and a payment's terminal-to process contactless payments using
close-proximity radio frequency identification.

3. ​ Sound wave-based (SWB) or sound signal-based (SSB) mobile payments or

pay-by-sound uses an advanced, ultra-low power, wireless transmission technology to
transmit data via sound waves that originate from POS terminals. Any phone with a
microphone can pick up those waves to complete a transaction without the need for internet.

4. ​ Magnetic secure transmission (MST) is when a phone emits a magnetic signal

imitating the magnetic strip on the payer's credit card, which the card terminal picks up and
processes as if a physical card was swiped through the machine. MST is secure as it uses a
secure tokenization system.

5. A mobile/digital wallet stores payment information on a mobile device, usually in an app that
utilizes different technologies in the payment process. They commonly work through complex
encryption and tokenization, a method using time-limited token numbers generated to process
the specific transaction using your already-encrypted card "stored" in your mobile wallet.

6. Quick response (QR) codes are the trademark of a type of matrix barcode (type 2D barcode)
readable by smartphones. This is more secure because your phone, that your card details are
securely connected to, confirms you are the owner of the card.

7. A QR code has four important advantages:

a. It stores a large volume of data.
b. It can be scanned from a screen, not just paper.
c. It can be read even if part of the code is damaged.
d. It is safer because information can be encrypted.

8. Short message (or messaging) service (SMS), also called premium SMS payments, simply
means paying for products or services via a text message with the relevant information to the
right payee phone number and the payment amount is added to your mobile phone bill.
9. Direct carrier billing (DCB) is similar to SMS payments because you pay through your
mobile carrier instead of using bank or card details, the payment will then be added to your
phone bill or prepaid SIM card as with SMS payments.

10. Internet payments can be done on desktops, laptops, or even phones (as in mobile payment)
and can also be used to send money to friends or family ity members.

11. Wireless application protocol (WAP) payments used to be the most common facility on
smartphones through a more limited-capacity WAP browser or app.

12. Most credit cards and bank accounts have what we call "auto pay," where payments to credit
cards or other bills, like for water, electricity, or whatever bills need to be paid, are scheduled to
be automatically paid on a certain date from funds of the payee with a certain bank. It can be the
bank doing the auto pay or the credit card company.

13. Payment links or pay by link is most commonly referring to a button/link sent in an email,
text message, messaging app, or over social media where a checkout page opens up in an internet
browser where the recipient can enter their card details to process a transaction for a specified
merchant.

14. Neobank literally means "new bank," and is from the Greek word neos meaning banking
services. They all operate online or through apps; hence, they are "new." It is an umbrella term
for the new generation of cutting-edge, fully digital classified as a type of financial technology
(fintech) solution.

KEY TAKEAWAYS

1. ​ Mobile payments are money rendered for a product or service through a portable
electronic device, such as a cell phone, smartphone, or a tablet device.
2. ​ Near field communication (NFC) payments is the technology that allows contactless
payments using close-proximity radio frequency identification.
3. ​ Sound wave-based (SWB) or sound signal-based (SSB) mobile payments or
pay-by-sound uses an advanced, ultra-low power, wireless transmission technology.
4. ​ Magnetic secure transmission (MST) makes use of a magnetic signal to process
payment using a secure tokenization system.
5. ​ Mobile/digital wallets work through complex encryption and tokenization to process
specific transactions.
6. ​ Quick response (QR) codes are the trademark of a type of matrix barcode (type 2D
barcode) readable by smartphones used in e-commerce to process payments.
7. ​ Short message (or messaging) service (SMS), also called premium SMS payments,
simply means paying for products or services via a text message.
8. ​ Direct carrier billing (DCB) is similar to SMS payments where you enter your phone
number on a payment page or in an app and the payment will then be added to your phone
bill or prepaid SIM card.
9. ​ Internet payments can be done on desktops, laptops, or even phones (as in mobile
payment).
10. Wireless application protocol (WAP) payments used to be the most common facility on
smartphones through a more limited-capacity WAP browser or app.
11. "Auto pay" is done when payments to credit cards or other bills, like for water,
electricity, or whatever bills need to be paid, are scheduled to be automatically paid on a
certain date from funds of the payee with a certain bank, just like a debit card.
12. Payment links or pay by link is most commonly referring to a button/link sent in an
email, text message, messaging app, or over social media to process a transaction for a
specified merchant.
13. Neobank is an umbrella term for the new generation of cutting-edge, fully digital
banking services classified as a type of financial technology (fintech) solution.