by Joseph Kenny | 07/8/09

Recent discussions about the possibilities of making credit card payments on cell have been renewed with the recent development of new applications to make this bridging of technologies by to feasible and convenient to use.

A number of investors, start-ups, and big corporations are putting money into new services that will allow you to use your cell to buy products and transfer funds. This would turn your cell phone into a virtual credit card or checkbook. This would provide the same click-and-buy commerce and online banking facility that consumers take for granted with their PCs. The biggest hurdle for this leap has been the technological limitations.

Any service must work on a variety of phone models and be compatible with cell phone service providers, the latter of which is the controlling agent for customer billing. What this means is that the development of this new system is taking an already complex business where safe and secure transactions between merchants and financial institutions and injecting a whole other level.

It has been such an obstacle that it has limited the growth of mobile payment systems in the past. One factor that has begun to change this trend is the introduction of the iPhone, the Blackberry, and other sophisticated devices. Such cells allow for easier interactions and experts point out that the new generation phones illustrate the fact that people are willing to buy music, games, and other virtual goods while they're on the go.

With more funding available for such endeavors the goal of developing new payment systems has created a potential market of competitors anxious to profit from their cut of the transaction fees.

One company, Obopay, lets consumer transmit money via text messages. The small start-up received $35 million from Nokia to develop the method. It remains the largest investment in a finance services start-up in 2009, based on figures released by the National Venture Capital Association. The first credit card company to utilize Obopay's technology is MasterCard, with its MoneySend service.

Recently, mobile payment start-up Boku received $13 million in venture capital. The company was formed by a merger between Paymo and Mobillcash, two other start-ups. Rather than using credit card numbers for transactions, the company hopes to let consumers use their cell phone numbers instead.

So far, mobile money-transfer services have had more success in developing countries than in the U.S., where fewer people have traditional bank accounts, and among people in developed countries who want to transfer money to relatives overseas.