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In a deal that could make financial capabilities more widely available through mobile phones, handset maker Nokia Corp. has made a strategic investment in payments-technology company Obopay Inc. Obopay, of Redwood City, Calif., is one of several companies that has developed payment tools for mobile phones, but a major hurdle in bringing banking capabilities to the mainstream market has been convincing users to download the applications or carriers to deliver them preloaded in handsets. Nokia's minority stake in Obopay, announced today, would enable the Finnish company to hardwire the software in its phones and could make it an important player in the global remittance market, analysts say. Gerhard Romen, Nokia director of strategic partnerships, says his company wants to make phones into widely used financial tools and compares payment capabilities to cameras. "In 2004, you might have seen a camera in a phone and wondered what this does," he says. "Today a majority of people use the phone as their primary camera" Mobile-banking technology would follow a similar path, he says, declining to provide any details about the investment or to say whether Nokia plans to incorporate Obopay's technology in its products. Nokia's handsets have been used in numerous trials of contactless payments at the point of sale using chips with Near Field Communications capabilities in conjunction with such companies as Visa Inc. and MasterCard Worldwide. Investment in Obopay takes Nokia in a new direction. Obopay's core technology enables consumers to transfer funds to each other. "This is a big deal for financial institutions," said Richard K. Crone, the founder of Crone Consulting in San Carlos, Calif. "If somebody else is provisioning the application before it gets to the consumer, that affects how the bank can provide its suite of services." Nick Holland, a senior analyst at the research and advisory firm Aite Group LLC of Boston, says Nokia, with its global reach, was angling for a piece of the cross-border remittance business, especially in developing markets.
