Transaction Network Services Inc. and Blue Bamboo have struck an agreement that enables independent sales organizations, merchant acquirers and processors to sell a mobile-payment system.

The system includes smartphone software and hardware and payment-gateway services for mobile merchants in North America. Mobile merchants may include plumbers, contractors or home-based product sellers.

Such merchants "in the past just chose not to take cards because of the costs involved in having a wireless [point-of-sale] terminal," said Gerry Grealish, vice president of global product marketing at Transaction Network Services. "Or if they were taking cards, it was in a card-not-present environment" — the card number would have to be read to someone over the phone.

Blue Bamboo, based in China, is providing the hardware and software, and Transaction Network Services, of Reston, Va., is supplying gateway services. The technology includes Blue Bamboo's PocketPOS payment application, which merchants download to their smartphones. The phone connects to the P25M magnetic-stripe reader and receipt printer via a Bluetooth or a serial or USB port connection.

Merchants may not use the application without the P25M hardware, said a Blue Bamboo spokesman. "We tie the app to be used in tandem with our P25M for card-present transactions and paper receipts," he said.

The system works with more than 30 smartphones, including Blackberry phones, though not with Apple Inc.'s iPhone.

The system will be available in the middle of the second quarter, likely in mid-May, said Travis Lee, Transaction Network Services' director of product marketing.

The cost for the smartphone hardware or software and to board a merchant to the system is less than $200, he said. Transaction Network Services also charges a monthly fee of less than $10 for monitoring and reporting of its Synapse gateway activity. Processors and acquirers could earn income from reselling the system by marking up the monthly service fee, Lee said.

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