This news report discusses the mobile payment trial in Strasbourg, where some customers can pay with their mobile phones and enter their PIN codes into the phone keyboard rather than the POS terminal keyboard.
Dave Birch refers to this trial in his vision of the future of retail payments: "the retail POS shrinks to a button on the shop counter, whereas all the "smarts" migrate into the mobile." Take a look at his post. It gives a compelling vision of where things could go without major changes in how the payments industry is structured. However, if the role of merchants continues to grow stronger, there could be a growing push to put more and more smarts into the POS, where it is much easier to create merchant-centric features. These two forces compete for two very different outcomes, one issuer-centric and the other merchant-centric. The true outcome will surely be something in between, but that could happen in a pendulum fashion.
To me, the Strasbourg trial feels like a huge amount of effort on another technological gadget that doesn't really produce substantial new benefits for cardholders or merchants. Very much like the Moneo e-purse trials that French banks spent a fortune on and that was never really adopted by anyone. Where is the sound marketing and branding rationale behind all these efforts? Please don't say that people want to run around with their mobile phones and leave their wallets behind. You won't get any serious marketing expert to believe that one.