Vodafone Tests Mobile-Payment System in Germany

Deutsche Presse-Agentur
03/16/07 9:20 AM PT

Speaking at the CeBIT computing expo in Hannover, British-based Vodafone and Deutsche Bahn said they hoped to develop a system that would be salable to other companies within the next year. Bahn planned to introduce the system nationally after the pilot phase. To participate, phones must be equipped with near field communication modules, which are fitted in many handsets.

Worldwide wireless company Vodafone (NYSE: VOD) said Friday it would make a fresh foray into the micro-banking business , testing a mobile payments system in partnership with German railways company Deutsche Bahn.

Instead of buying tickets, passengers will simply press a button on their mobile phones as they hold it near a "touch-point" when they board and disembark from a train. They will then receive a monthly bill for the total of their travel.

The pilot project, code-named Touch & Travel, would be operated from October on an intercity line between the German capital Berlin and Hannover, Germany, and on public transport in the suburbs of Berlin.

Near Field Communication

Speaking at the CeBIT computing expo in Hannover, British-based Vodafone and Bahn said they hoped to develop a system that would be salable to other companies within the next year. Bahn planned to introduce the system nationally after the pilot phase.

To participate, phones must be equipped with near field communication (NFC) modules, which are fitted in many handsets.

Previously Tested

Big international phone groups have in the past tested schemes to use phones as devices to make small payments. Such systems would have made phone companies competitors to the credit card industry, with customers settling their bills monthly with the phone company.system

Previous mobile phone projects were abandoned after phone companies grew concerned at the high risks and lack of profits.