The duo will initially offer payment cards with near-field communication chips in Poland, and will later expand to other countries such as Germany. These cards will be issued through Deutsche Telekom's subsidiary ClickandBuy, and will allow customers to complete a transaction by moving the card close to a cash register. In the later phase, the technology will be integrated into SIM cards for use in mobile phones.
The partnership will allow MasterCard to capitalize on Deutsche Telekom's vast customer base, which includes more than 90 million customers across Europe.
(V) has also entered into a similar agreement with
(VOD) to cater to more than 390 million customers across 30 countries. (See our full analysis for MasterCard
Mobile phones are quickly turning into an essential personal item, as smartphones such as Apple's (AAPL) iPhone have seen a surge in popularity in the last few years. Payments via phones are gaining increasing popularity as they offer great convenience, without the burden of carrying cumbersome cash.MasterCard has taken several initiatives to promote the technology in the U.S., but the lack of a definite regulatory framework has so far impeded its progress in the European region. The collaboration with Deutsche Telekom and Visa's recent agreement with Google (GOOG) to launch a smartphone with payment services could well spark off a revolution in the continent. The NFC technology is gaining acceptance among mobile companies. Research by Juniper Research suggests that nearly 300 million smartphones, accounting for 20% of the world's handsets, will use the technology by 2014. This will further promote the use of mobile phones as a reliable medium to carry out transactions on the go, and we expect it to fuel a rise in MasterCard's Gross Dollar Volume, or the dollar value of the transactions processed by the company. Our
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