Money wiring company Western Union thinks that mobile phones are an ideal platform on which people can transfer money to one another. So they’ll soon be ready to roll out such a service. The platform has been tested in a handful of U.S. cities, and will be ready for widespread use sometime in the second quarter of 2008. You can even transfer money overseas, which is an added bonus for plenty of people, including parents with children studying abroad. Surely there are security issues they need to work out, which is why we think they’re waiting until the middle of next year to make this widely available.

There are a few drawbacks. First is that this is a GSM service, which shuts out many cell phone users in the U.S. If you are a subscriber of Sprint, Verizon, Alltel, or any of their MVNOs — plus regional providers like U.S. Cellular, MetroPCS, and Cricket — you’re not going to reap the benefits of this service. Though we’re pretty sure a similar service will soon be available for those companies. For instance, MoneyGram, a Western Union competitor, would do well to target the CDMA crowd.

Still, security is the main issue here. This is the only hint we’ve read as to what the process will be: “It will connect a cell phone user to a Western Union operator who will complete the transaction using special company software.” Okay, that’s great and all, but what about ID verification? Mobile phones are stolen every day, and we’re sure this kind of service would give thieves a greater incentive to snatch your phone.

We’re sure that there will be security measures announced before the service rolls out. Americans are becoming extra-wary of insecure transactions, so Western Union is basically obligated to disclose everything, lest they risk people simply not using the service. We’ll see next May, we suppose.

[Associated Press]

Posted By : Stuart
Posted at : October 19th, 2007 - 10:00 am
Filed under : Prepaid Services