Credit card companies unite for a checkout button to take on PayPal

Photo by Philip Taylor from Flickr

There is a huge chance that you have reached for the checkout button of Paypal when you are doing online shopping even if you do not use Paypal for sending money to other people. The checkout button of Paypal is apparently tied to all your payment information. It is considered to be easier than looking for your wallet.

Recently, however, Bloomberg and the Wall Street Journal reported that major credit card companies such as Mastercard, Visa, Discover, and American Express are joining forces to create a checkout button of their own. It apparently means that it would be the end of Visa Checkout and Masterpass, the services that tried to replicate the experience offered by PayPal.

The concept is pretty simple as people will make more purchases if they can checkout easily. PayPal was the first one to introduce the concept of a digital wallet. It placed all of the payment options of shoppers behind a single service. Amazon ultimately followed suit with the introduction of its own button for checkout. It was only really a matter of time until these traditional credit card companies followed the trend. However, it is not clear when their unified checkout button will be launched. Bloomberg says that Mastercard and Visa still has not discussed the offering with the retailers, and they are aiming to work with the World Wide Web Consortium, which sets the standards for browsers.

Aside from being faster, the new checkout button should be much more secure. It will make use of the token technology that Mastercard and Visa depend on, which generates a temporary digital ID for each purchase, instead of making use of your actual card number. The technology should cut down on fraud. It will also make it easier for the users to keep their your payment information up to date with the online services (since the said tokens will notify the users when they get new cards).