Isis in crisis?

Isis, a mobile payments joint-venture between AT&T, Verizon and T-Mobile in the US, has scaled back its initial plans to roll out its own mobile payment network in favour of an m-wallet-style offering.

According to reports in the Wall Street Journal, the telcos have decided that setting up a separate payments network would be too difficult and time-consuming.

US-based carriers have been slow to gain traction in the mobile financial services market, where innovation has been hindered largely by the inability of the banks and carriers to agree to share the customer. The formation of Isis was geared towards taking a slice out of market share held by Visa and Mastercard, with the telcos setting up their own NFC-based payments network and collecting fees on transactions conducted using mobile devices.

In what looks to be a complete U-turn, the carriers are now said to be in talks with the card issuers to roll out mobile wallet services that operate around the storage and exchange of account data on subscribers’ credit cards.

When it launched last November, Isis announced that it was partnering with Discover Financial Services and Barclaycard in what was seen by many as an effort to play the banks and card issuers – many of which had been piggy-backing on handsets using MicroSD cards – at their own game. An Isis spokesman told the WSJ that Discover continued to be the venture’s partner but said it was open to forming new alliances.

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