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Visa Inc. is pushing forward with plans to make the mobile phone an important financial tool by offering its first commercial application to link handsets with U.S. payment cards.
The San Francisco company has been testing a variety of financial applications for phones in this country and elsewhere. Today it is expected to announced that it is offering a tool that allows people to manage their credit and debit cards through phones that use Google Inc.'s Android operating system.
Analysts said that even though the Visa Mobile for Android application notably lacks payment capabilities, it shows that Visa has both a long-term vision and a plan to make the mobile phone a widely used banking device.
"I like how Visa is thinking strategically about mobile and not taking a one-size-fits-all approach," said Bruce Cundiff, a research analyst at Javelin Strategy and Research of Pleasanton, Calif. "They are jumping right in on the platform."
Nick Holland, a senior analyst at Aite Group LLC of Boston, called the application a step in the right direction as mobile commerce evolves, but he said making potential users aware of it and promoting adoption will be a challenge. "There's a lot of noise out there and not necessarily a great deal of signal."
The Visa Mobile for Android application offers transaction alerts, marketing offers, and location services. Initially it will work only with cards issued by JPMorgan Chase & Co.
"We believe this has the ability to enrich the payment experience for customers in the United States," Pam Zuercher, the vice president of product innovation at Visa U.S.A., said in an interview Friday. "It's a milestone for us."
For the next four months Visa plans to offer the application exclusively to customers of JPMorgan Chase, Ms. Zuercher said. "After that exclusivity period is over, we absolutely intend to offer this up to other issuers in the United States."
Visa has said it expects consumers to eventually use their phones to store information about multiple card accounts and to initiate transactions at the point of sale or online.
Analysts said that the application will bring the payments company a step closer to that goal, and that Visa is trying a variety of approaches to gain a foothold in the early stages of this still-developing market.
Only one handset on the market uses the Android operating system, the T-Mobile G1, which was introduced in October. Consumer demand for the handset has been strong, with 1.5 million units presold, and more models that use Android are expected to hit the market soon.
"The Android operating system is going to become pretty prolific pretty fast," because handset makers are not charged for using it, Mr. Holland said. "With an open operating system, it's likely to expand fairly quickly to other devices and other networks."
Visa started offering the application last week through Google's Android Market, the online service that lets consumers download applications to their Android phones.
Other mobile initiatives by Visa involve domestic and cross-border person-to-person fund transfers, as well as contactless payments using near-field communication chips embedded in a handset and tied into the phone's operating system.
In the longer term, some of these capabilities are likely to converge, enabling mobile contactless acceptance for merchants such as home-based crafters, Ms. Zuercher said.
Visa Mobile for Android provides three services to the handset, she said: alerts and notifications sent by Visa, marketing offers from its merchant partners, and an integrated locator function that links a phone's GPS system with the Google Maps service.
After downloading the application, users enrolls their cards by entering the account number and other information. Users also can set preferences such as thresholds for alerts.
The alerts are sent to users' phones after a transaction almost immediately, Ms. Zuercher said. "Because this runs off our authorization system, these notifications can appear on your handset in near real time, practically before you walk away from the point of sale."
Visa said it has signed up 14 merchants, including 1-800-Flowers.com, Bonefish Grill, Jos. A. Bank, Lenovo, Overstock.com, Planet Hollywood, and Shoes.com, to provide offers and virtual coupons that may be redeemed at stores or online.
In September, Visa had said it was developing a mobile application for Android.
Visa and JPMorgan Chase recently completed a four-month trial in Phoenix in which 50 merchants made 100 different offers to consumers through text messaging, Ms. Zuercher said. "That trial informed the commercialization on the Android platform."
A spokeswoman for JPMorgan Chase said the New York company would not comment for this story.
Visa has already begun the commercial rollout of mobile services in other markets.
In South Korea, commuters can use their Visa accounts to top up the balances on their contactless transit cards automatically.
In Brazil, Banco do Brasil SA's Visa cardholders can use their handsets to complete a variety of mobile transactions, such as food delivery or pharmacy purchases, which can be confirmed by text message.
Ms. Zuercher said there are several benefits from developing applications for open-source systems, such as Android.
"That's very compelling to Visa, because we're able to code our app once and maximize the number of distribution points," she said.
However, she did not rule out developing similar applications for proprietary mobile operating systems, such as Apple Inc.'s iPhone or Microsoft Corp.'s Windows Mobile.
"We're working very hard with all our stakeholders to optimize the mobile ecosystem," she said.
