SBIR Phase II: Secure SMS and Web Service Transactions for Mobile Commerce

This Small Business Innovation Research (SBIR) Phase I project will deliver a mobile payment communications infrastructure, mobile device apps for utilizing that payment infrastructure, point-of-sale solutions for merchants that utilize the payment infrastructure, and will establish the framework for a local advertising network. The mobile payment system takes advantage of the speed of contemporary mobile devices to enable secure web-based transactions. This payment system revolutionizes payment by bypassing existing legacy credit and debit card infrastructure. New security algorithms and models will be developed to enable the secure transfer of banking information. The proposed payment system empowers consumers to control privacy, security, and localization settings in their mobile payment apps. The local advertising network changes the value proposition for both merchants and consumers with respect to ads and coupons, creating an environment in which merchants ?push? ads to ?pulling? customers. The local advertisement network will fundamentally alter the way users think about localization, privacy, and data anonymity. The broader impact/commercial potential of this project includes the creation of a payment system that revolutionizes commerce. The system will dramatically reduce or eliminate payment interchange fees for merchants, will move consumers much closer to the concept of a fully digital wallet, and will create a new level of engagement between merchants and consumers that is mutually beneficial. Small, independent merchants will immediately realize many of the benefits of the payment network. These merchants typically pay between $15,000 and $200,000 annually in credit and debit card interchange fees. The proposed payment system will reduce or eliminate these fees enabling business expansion and job creation. The payment system effectively creates local commerce zones where ?buying local? is implicitly strongly encouraged through in-network, in-app local advertising, coupons, and loyalty programs. The payment system includes seamless peer-to-peer digital funds transfers. The ultimate goal is a payment system to make all commerce - all transfers of funds - frictionless, fast, simple, and easy. The mobile commerce market is expected to grow from over $200B this year to over $600B by 2015. The technology developed herein will be a vital driver of that growth.