Infrared Payment Shines at CES

Infrared Payment Shines at CES

In issue 00:03:01, we introduced our readers to IrFM (Infrared Financial Messaging), a non-proprietary payment protocol that functions as “a common track” for processing digital payments initiated over wireless connections (infrared). IrFM specifications form the basis of an open, universal standard for payment processing equipment and financial services. The standard is designed to accommodate more than 200 million mobile phones, PDAs, POS terminals and other IrDA-enabled devices already in the marketplace.

Last March, we reported that the Infrared Data Association (a non-profit association that promotes and sets standards for the exchange of data between electronic systems using cordless, infrared connections) had approved the formation of a Special Interest Group (SIG); there was strong interest from industry members.

In issue 00:08:01, we reported that The Financial Services Technology Consortium’s executive committee reviewed and subsequently approved the SIG’s proposal and created a Memorandum of Understanding, which created a link between the Infrared Data Association (IrDA) and FSTC to open a bilateral flow of information. We reported that the SIG planned similar alliances with other trade associations and we promised to keep our readers up-to-date on the evolution of infrared devices.

We keep our promises and following are the latest IrFM developments.

Last month the IrDA, Visa International, Palm Corporation, VeriFone, CrossCheck and Personal Solutions demonstrated the emerging financial messaging standard at the Consumer Electronics Show in Las Vegas, Nevada. The IrFM demonstration included a payment made from a Palm handheld device through a POS terminal via an infrared connection. The authorization request was then sent to CrossCheck for verification and, after verification a payment authorization message was sent back to the terminal to finalize the transaction, create a receipt and transfer the receipt to the Palm. The process was complete in a matter of seconds.

The demonstration was important because it clearly showed that existing IrDA-enabled handheld devices and POS equipment can communicate financial transaction information quickly using an infrared beam. The standards developed by the IrFM work group within IrDA are setting the stage for future development of digital payment systems.

Another highlight of the show was the keynote speech delivered by Palm, Inc.’s President and CEO, Carl Yankowski. Yankowski concluded his talk with a demonstration, prefacing it with, “Let’s talk about IrFM.” He then moved to a corner of the stage where a mock-up of a Sharper Image store had been set up. In the following five minutes, a Sharper Image rep persuaded Yankowski to buy a SONY robot dog, an Atomic Time wristwatch and portable telephone equipment to the tune of $1966. Yankowski paid for all of this on the spot, using his Palm handheld computer equipped with an Ingenico payment application, to beam a virtual Visa credit card payment to one of Ingenico’s POS terminals equipped with a plug-in Extended Systems infrared adapter.

In the time it took for a live Visa authorization, Yankowski scooped up his booty and walked back to the podium with three new toys, a digital receipt in his Palm and a much higher balance on his credit card account. That transaction was the future of payments, taking place today. And, it followed some core IrFM beliefs: any “new” digital payment system should be based on existing clearing and settlement infrastructure, it should be a better alternative than paper or plastic systems for all concerned, it should not add significant costs for anyone in the system and finally, no stakeholder should have to make hardwired changes or worry about backward compatibility for their components.

Watch the pages of The Green Sheet for future IrFM developments. If you would like more information about IrDA and IrFM visit www.irda.org or www.irfm.org.

CrossCheck, Inc., provides retail point-of-sale authorization services, demographic and psychographic profiling, and payment conversion and imaging capabilities. For more information visit www.cross-check.com or contact Mike Harris, Vice President, National Sales and Marketing at (800) 654-2245.

Personal Solutions, Inc., headquartered in Danville, CA, is a research and development company involved in the creation and marketing of advanced consumer products, intellectual property and financial payment technology.

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