What's in your [mobile] wallet?

It can't spit out cash like an ATM, but the mobile handset is rapidly becoming the next most viable platform for banking. Today, this pocket banking experience mirrors that of online banking in form and function — checking accounts, transferring money and paying bills — but the mobile bank of tomorrow has the potential to transform how consumers purchase products, exchange money and manage finances on the go.

This mobile wallet of the future will let consumers deposit and withdraw cash through on-device clients, send money to friends or family via a short message service text, or purchase an item through near field communications (NFC), an RFID technology that enables data exchange with a swipe of the phone. IMS Research forecasts that the number of active users of mobile banking and payment services will increase 662% over the next four years, while overall mobile users will grow at just 32% in the same period. The aforementioned functionality could be a leading driver of the explosion in mobile commerce, but today consumers and vendors are still realizing the possibilities. Firethorn, acquired by Qualcomm last year, is one prominent provider of mobile banking services. The goal of the company is to keep increasing functionality, with mobile payments being the ultimate goal, according to Kelly Buday, director of marketing for Firethorn. It isn't out to recreate Internet banking on the phone, but rather to turn the handset into a usable device for banking, payments and transactions. Real mobile commerce is the end game.

“A lot of people tend to go from looking at your balances to all of the sudden NFC, and we see it as a progression,” Buday said. “Payments are definitely a big part of the importance and value a phone can provide. There could be relevant info provided to the consumer, be it an offer or something that provides them value as they are about to make a purchase.”

The example Buday used was of a consumer going to a store to buy something. Rather than search for coupons and best offers, the shopper could use a mobile wallet to display each credit card's information and balance. If using a certain card garners a 10% discount, consumers will have that information at their disposal.

“That is relevant and compelling info for the consumer to use their mobile channel and their accounts within their mobile wallet versus going back to their computer, printing off a coupon, going to the store, etc.,” Buday said.