A Las Vegas start-up company is promoting a hand-held device that lets people pay bills, shop, and even place bets over the telephone.
The device, called Pay Master, can accept credit cards, debit cards, and smart cards, according to Betting Inc., the company marketing the product.
First Tennessee National Bank of Memphis has signed on as a banking partner for the testing phase, but it is not involved in the gambling aspect of the system.
Betting Inc. is testing the units in three locations in California and plans to add more sites early this year. It hopes to sell Pay Masters through retail stores, appealing especially to people interested in placing wagers on sporting events, as well as to mall owners, telephone companies, and others.
"We want to target anything from plastic surgeon offices to airport lounges-places where people are more than happy to spend $30 or $40 when they are bored," said Tom Hughes, chairman of Betting Inc.
Mr. Hughes is also the founder of Electronics Transactions and Technologies, which makes the Pay Master devices.
It is not the first such personal payment idea. It is a variation of the screen telephone, with which some banks have experimented. Verifone Inc. of Santa Clara, Calif., offers a "Personal ATM," a hand-held smart card reader that hooks into a telephone jack.
Gambling, already showing signs of popularity in cyberspace, could add a note of controversy to the payment services context. Some states have rejected proposals to allow telephone placement of lottery bets.
"If this product is focused primarily on gambling, it might hamper acceptance, because people would associate it with gambling as opposed to broad utility," said Stanley W. Anderson, president of Anderson & Associates in Arvada, Colo.
Mr. Hughes said Pay Master's betting option would be limited to seven states with legal off-track betting: New York, Pennsylvania, New Jersey, Rhode Island, Connecticut, Ohio, and Maryland.
Mr. Hughes said he is courting utility companies that might want to offer customers an alternative bill-paying service. Despite the company's name, he has a broad interest in electronic commerce, and sees gaming as "the perfect industry" to target.
Each Pay Master costs $650, but Mr. Hughes hopes to drive that down to $85. The company would collect $1 on each transaction.
Betting Inc. said it has a license to market a wireless version that could be attached to mobile telephones. Both of its systems would issue receipts.
Mr. Anderson said he had doubts about public acceptance, citing Pay Master's high price and saying consumers would be more comfortable dealing directly with their financial institutions or card issuers.
Mr. Hughes, who is searching for a chief executive officer, exudes an entrepreneur's optimism. He predicted Pay Master would appeal to "the 60% of the country that doesn't have a computer yet." And he believes merchants would pay the transaction fees on behalf of their customers because of the benefits of direct electronic payments.
"By the end of next year we envision the equipment will be offered in stores like Radio Shack," Mr. Hughes said.
