Visa today introduced a cloud-based mobile payment system that can be used by retailers and financial institutions to add wave-and-pay functionality to their apps, services, and retail locations. Most mobile payment systems rely on the customer's financial data being stored in a secure chip on the phone, which is then accessed during sales transactions. Visa's new system stores the customer's financial details in its own cloud thanks to Android's Host Card Emulation (HCE) feature. According to Visa, "HCE allows any NFC application on an Android device to emulate a smart card" so the user can make tap-and-go payments. The new system works in conjunction with Visa's existing payWave terminals. Visa is releasing the initial standard for NFC cloud-based mobile payments today, and will add support for QR codes and in-app payments down the road. Visa eventually plans to release an SDK so its clients can write their own cloud-based payment applications. Separately, MasterCard announced a similar HCE-based initiative that it is working on with Capital One in the U.S. and Banco Sabadell in Europe. MasterCard expects to publish its standards by June. Both companies hope to expand the use of smartphones - rather than actual credit cards - to make retail payments.


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