Back in February we published an article about using cell phones like credit cards, which was a project headed by MasterCard expected to take flight in the next couple years. Well, a project similar in nature is happening sooner than later. On Wednesday BusinessWeek published the credit card company announced a state-of-the-art concept incorporating mobile phones and the green stuff. Later this month MasterCard will be launching MoneySend, which will allow users to transfer money to others via text messaging. So now when you owe your friend money, no more excuses that you haven’t seen them lately – you can text it to them.
Alright, this sounds a little weird. You send someone a text message and money appears from one account to the next? There has to be more to it than this. There is, but not much. Users must sign-up online with a debit card, credit card, or bank account for a prepaid account. They are then able to transfer any amount from $1 to $500 to someone else by sending them a text message. The recipient must clarify what bank account they would like the funds deposited into. After a transfer has been made, MasterCard will call the sender to make sure the amount and recipient is correct which will be verified by a pin. There will be a small fee for this service, which MasterCard expects banks will pick up.
While the technology seems like it would be the biggest obstacle for MoneySend to take off and become a popular service, it’s not. Convincing consumers to get over their fears associated with fraud and mobile banking is the issue. The program is said to resemble popular online shopping websites like PayPal and ebay to help consumers be more comfortable with the new transactions.
Another issue that has yet to be cleared up is what the revenue split will be among phone companies, banks, and credit card companies. It’s becoming more and more popular to do everything on your phone that you do online from shopping to online banking. I could see MoneySend becoming popular, especially among the younger generation. I think it is a service I would use. Our information is already out there. If someone wants to take it, they will find a way. What do you think – is this a service you would use?