McGinnis said that it will soon offer a similar wallet to customers of its other prepaid brand — Virgin Mobile — and it is considering bringing it to the main Sprint brand as well. Sprint also plans to build on Wallet’s initial batch of services, to create what McGinnis calls “a virtual bank” for its customers.

Today, Boost’s Mobile Wallet can transfer funds between accounts, pay e-bills, wire money to physical locations and, with the help of prepaid Visa card, you can make purchases and withdraw money from ATMs anywhere Visa is accepted. Soon Boost’s wallet will let you scan physical checks, depositing funds directly into your wallet account.

But McGinnis said there are other services in the works. He didn’t provide specific deals, but it’s not hard to imagine features like virtual checking accounts or peer-to-peer payments such as those offered by PayPal, Venmo and now Google and Square.

Sprint doesn’t want to become bank itself — that would put it under the regulatory scrutiny of the U.S. Department of Treasury, which Sprint wants to avoid, McGinnis said. Instead, Sprint is working with Wipit, a mobile payments provider focusing on people without bank accounts and credit cards, to provide the financial services infrastructure.

“From the customer’s point of view, it’s kind of a bank in the sky that is Boost backed,” McGinnis said.

Sprint’s wallet is unique because it focuses on what the financial industry calls the unbanked – households that deal almost entirely in cash. Most other wallet and financial services apps are linked to bank accounts, credit and debit cards. This approach to financial services has had a huge impact in other parts of the world and has made Kenyan mobile operator Safaricom the biggest bank in East Africa.

The U.S. isn’t Kenya, of course, but according to a Federal Deposit Insurance Corporation study (pdf), 8.2 percent of U.S. households have no bank account whatsoever, while an additional 20.1 percent of U.S. households have a bank account but also make use of alternative financial services such as check cashing and payday loan companies.

Of the major providers, Sprint is in an ideal position to serve those customers. People who rely primarily on cash naturally gravitate towards prepaid mobile phones, and Sprint is one of the most aggressive carriers when it comes to prepaid. It runs three prepaid brands (Boost, Virgin and Assurance Wireless) and offers pay-as-you-go options on its primary Sprint brand as well. At the end of the first quarter it had 16 million customers on prepaid plans.

While Mobile Wallet’s initial focus will be on those unbanked customers, McGinnis said there is a lot of potential for the app for customers who have traditional bank accounts, especially as Sprint and Wipit add new features to the app. That’s one of the reasons McGinnis thinks Mobile Wallet will be a good fit for Sprint’s contract customers.

Sprint already is working with Google on mobile payments, but McGinnis pointed out that Google Wallet is really a point-of-sale transaction technology linking to credit cards or bank accounts. Meanwhile, Sprint’s Wallet is intended to be a replacement for or a supplement to those accounts and payments cards — just without the actual bank.

“There’s nothing broken with plastic in retail today,” McGinnis said. Sprint, he added, just wants to make that plastic available to more people.

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The payments startup is now chummy with the top two POS terminal and software makers used by U.S. restaurants (the other is Micros), and has deals will several smaller suppliers. The startup still has a long way to go before all of the burger joints and bistros that use those systems adopt its payments solution, but it’s comfortable in the knowledge that half the restaurants in the country could easily adopt that solution.

LevelUp offers both its own mobile payments app and white label technology that retailers can integrate into their own apps. In both cases, the implementation is pretty simple: they generate QR codes linked to a customer’s credit card information, which they can then scan into a terminal at the restaurant to make a mobile payment.

That terminal could be as basic as the proprietor’s smartphone (several previously cash-only merchants have used LevelUp to start accepting credit card payments), requiring no additional hardware, or it could take the form of a dedicated terminal. LevelUp takes 2 percent off the top of any transaction, but it also uses its platform to track customer data for rewards and promotions, bridging the gap between a loyalty program and a payment processing service.

At the end of 2012, LevelUp’s apps had about 500,000 users and it was handling about $5 million in transactions each month. Even in the nascent mobile payments market that makes it relatively small, however – in 2012, Square’s annual processing rate was $10 billion. But LevelUp believes it can become the Android to the Square’s iOS by working with other players like NCR in transaction value chain.

That’s one of the main reasons is focusing on independent restaurants, LevelUp said. Most restaurants already have a fully functioning (and often expensive) POS system in place. Instead of requiring a business to implement a new system for mobile payments, LevelUp merely acts as an appendage to their existing ones.

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It’s not different merely on the basis of functionality – although it communicates with the merchant’s iOS or Android device via Bluetooth, rather than by being plugged into it – but mainly because of the company behind it. Netherlands-based Adyen is already an entrenched online and mobile payments provider for multinationals such as KLM, Vodafone and Groupon.

European competitors such as iZettle and Payleven are going after small businesses and sole traders who would otherwise be unable to handle physical card payments. So is Adyen, but Shuttle is mostly aimed at bigger players.

And that means looking at the business from a different angle. Adyen, which already provides those familiar gray VeriFone point-of-sale devices, is pitching Shuttle as a way of bridging the online and real-world sales environments from a reporting perspective. For example, a customer may have used his or her card on the merchant’s website, giving the merchant useful background when the same card gets used in-store.

“Within our offering, it’s a true multichannel offering,” Adyen chief commercial officer Roelant Prins told me. “The companies that are looking to use this already use us for e-commerce. They already know the way we provide reporting, our back office and everything.”

Adyen is keen to push the cost-effectiveness of Shuttle as a POS tool – the device costs €99 ($129) and the service €10 a month, while traditional point-of-sale terminals cost many hundreds. But Prins also had an interesting point to make about the mobility aspect of the service:

“Look at the luxury merchant in Holland who is focused on getting rid of the till and taking a mobile approach. If you buy a €500 purse, you don’t want to queue up to make a payment.”

Adyen has apps and an API for Shuttle, and will also be white-labeling the EMV-compliant service for anyone who wants to resell it. This is partly a function of the fact that Adyen processes payments end-to-end – it does not have to rely on banking partners to do this.

So, what does this mean for the emerging mobile payments sector?

Square can breathe easy for now as, while Adyen operates globally, the Shuttle rollout is Europe-only – for now. But within Europe, things are about to get interesting.

Until now, it had looked like iZettle was shaping up to be the winner – the company has been scoring crucial partnerships with banks and telcos alike.

However, iZettle remains hampered by the fact that it cannot provide a full chip-and-PIN service for customers with Visa cards: a dispute with Visa led instead to a somewhat less-slick workaround. Shuttle is full chip-and-PIN for all cards, and Adyen’s existing customer base means it can hit the ground running.

This is a new market, and it may well prove to not be a matter of the winner taking all. But it’s just received a pretty big shakeup.

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At least part of that story is real, and Apple can make the second part real very soon if they use their $110 billion pile of cash to acquire the two companies that will help them get control of the local point-of-sale market, everywhere. Yes, I am suggesting that Apple acquire both Foursquare (let’s say, at a $1 billion to $2 billion valuation) and Square (currently evaluated at $4 billion, more or less). Paying a premium on both, Apple could keep it at $10 billion between them.

And what does Apple get?

A complete take over — and a true overhaul — of the local point-of-sale market. How much is it worth? Nobody can tell for sure. To give some examples, according to IBISWorld the grocery store market alone is worth an estimated $491 billion annually and convenience stores are a $51 billion market (a subscription is needed to view these reports). As Jason Calacanis wrote recently, if iPhones accounted for one percent of restaurant sales, that would be $6 billion of the $604 billion spent in 2011.

Apple-Foursquare-Square could jumpstart Apple on its way to take over a major part of the transactions in these (and many other) industries. Let’s look at what all three companies get out of this:

Apple gets:

* An immediate presence in the POS market, including merchant relationships. And it will get a platform for local payments that connects to the 200 million strong credit card database the company already has.

* The holy grail of advertising: conversion information. Apple will gain the ability to track customers from search and (even better) iAds to a point-of-sale purchase. We can only imagine how much that’s worth (read: a good chunk of Google’s business).

* Superior local search. Foursquare Explore continues to get better, and it is inherently social — ages ahead of any local search that exists today. Explore has been consistently improving, even outside of such major markets as New York City. If your friends are on (and if they have an iPhone, they will be if after this move), no other service can give you better personalized information about local businesses.

* A development team that is social to the core. Apple has long been accused of lacking “social DNA.” The Foursquare folks could be the seed of social at Apple — even beyond the location sharing — just like Flickr was the seed of social at Yahoo (well, maybe not).

Foursquare gets:

* More checkins and better information. Checkins should be implicit for every single purchase made, creating an immediate personal history. And if you haven’t checked in yet, then there should be an option to “explicitly” check in (i.e. broadcast to friends) when you make a purchase. More data means better recommendations, and it also makes additional services possible, not to mention better user modeling for marketing purposes.

* Easier integration for loyalty, business deals and coupons. Benefits could be factored right into the payment.

* Hundreds of millions of additional users from pre-installed iPhone clients. Additionally, other applications will be able to work with logins and data using device-level integration (similar to Twitter’s integration into iOS).

Square gets:

* 200 million pre-installed devices with credit card details already attached through customers’ Apple Store accounts, i.e. zero client acquisition cost.

* Hundreds of millions of devices equals a great motivation for merchants to sign up.

To summarize: after the deal, Apple will immediately become a giant payments company, with an installation base that is expected to encompass half of all mobile devices sold. The company will have the best local search abilities, far exceeding any existing recommendation engine. And due to its enormous reach, it will possess a payment system that merchants will line up to support. Who’s betting against this holy trinity? Not me.

Mor Naaman (@informor) is an assistant professor at Rutgers University where he directs the Social Media Information Lab. He is the co-founder and chief technology officer of Mahaya.  

Image courtesy of Flickr user miamism.

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As Google and Isis, the carrier-led joint venture, bring forward new NFC-based payment systems and PayPal builds its own in-store solution for payments that leans on other methods besides contactless, they’re increasingly looking to VeriFone to make sense of it all for merchants, which are confused about how to handle this transition to alternative payments. The thinking by VeriFone, Google, PayPal and others is that VeriFone can help lead merchants and retailers through this transition by becoming a managed services provider, not just a payment system seller, VeriFone CEO Doug Bergeron told me in an interview.

By helping integrate these new payments models into the existing systems of merchants, VeriFone can be an independent third party, a “Switzerland,” said Bergeron. He said VeriFone can make all the alternative payment systems and their new discounts and loyalty features work through point-of-sale hardware merchants are familiar with.

“We’re realizing our customers need more than just our products; payments is [sic] getting too complex for them and they need ongoing service. They need someone to manage not only credit card acceptance and security but all the new stuff that will co-exist like Google Wallet, Isis, and PayPal and Groupon. Retailers want the ability to keep current with all this stuff  but they can’t hire an IT team.”

VeriFone CEO Douglas Bergeron

That’s where the purchase of Point comes in. Point — which offers point-of-sale technology and support, payments gateway services, card encryption services, and multi-channel e-commerce processing – has the biggest footprint in Europe with 475,000 merchant contracts, which will no doubt extend VeriFone’s existing business. But really critical in the pick-up are Point’s services business and technology.

Point doesn’t just sell terminals; it provides merchants with ongoing security, compliance and technological capabilities, as well as other mission critical service. That fuels a recurring services model that will add about $260 million in sales over the next 12 months to VeriFone. VeriFone plans to use Point’s technology and business model in other markets where payment systems are mature to help retailers make the transition to alternative payments.

VeriFone said with the addition of Point, its services revenue will grow from 20 percent this year to 30 percent in fiscal year 2012 and will hit 50 percent of revenues by 2015. By that time, services will represent a $1.5 billion business, including rentals. If all goes according to plan, the company will become a services provider, delivering remote support and help in connecting these new payments solutions with a retail business’ system and ultimately with their banks.

This strategy isn’t without risks. Standard & Poor’s lowered its outlook on VeriFone Tuesday based on the debt it was taking on for the Point deal and the integration risks. And it’s unclear if VeriFone is being too optimistic in its belief that merchants will turn to it for managed services. But this is where VeriFone is ultimately going as it tries to become a full-blown resource for merchants and retailers. That’s the motivation that went into its recent purchase of Global Bay, which helps retail employees connect with consumers on the sales floor through mobile devices and provides software that ties into inventory systems and online commerce sites. Bergeron said merchants are increasingly going multi-channel, blending online and offline commerce, and they need more help in doing that.

It shouldn’t be a surprise that VeriFone is poised to capitalize on payments. It has been around for years and has a huge footprint in the U.S. with its point-of-sale terminals. But it’s making some bold decisions to grow beyond the point of sale, getting on to the sales floor with mobile devices like its PAYware card swipe tool and with Global Bay’s software and creating a services business that can provide a lot more recurring revenue. It’s hard to say which digital wallet and alternative payment system will win out. And VeriFone doesn’t connect to other mobile-based solutions like rival Square. But with its latest moves, it seems VeriFone will do quite well as the payment landscape goes through a lot of upheaval in the coming years.

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Perhaps not for another app-based rival, but that’s not what Own, a Detroit-based startup, is trying to do. The company is building its own point-of-sale technology, everything from its own dedicated tablet hardware to an optimized operating system that connects to a cloud service, enabling merchants to tie all of their payments, analytics, social media and deals into one experience. Basically, Own is reimagining the point-of-sale system for modern retailers, who are ready to make the leap to a smart web–based system.

The company is announcing some big news, including $1.2 million in seed funding from Detroit Venture Partners and the relocation of the company’s headquarters to San Francisco. Own will continue to run sales and customer service out of Detroit.

Own faces some long odds in remaking the point-of-sale experience for retailers and merchants. It’s asking business owners to pay $1,300 for each tablet point-of-sale device, all of which are built by Asus. And customers will need to pay $150 per month for the service. By contrast, many businesses can get a Square app and dongle for free to accept credit card payments.

But the difference is that Own users get a purpose-built system, not just an app, said Verdi Ergun, one of Own’s co-founders. Own has built its own Linux-based operating system that blends a number of business tools into one platform. Businesses can not only receive payments through the card swipe reader on the tablet but can also track and analyze sales information over time and export their data to Quickbooks and Excel. They can also manage their social presence on Facebook, Twitter, Yelp and Foursquare; easily push out deals and offers to users; and set their online menus from one dashboard called Up. Even employee scheduling and clocking in and out can be handled through Own’s tablet. Own CEO Rajeev Viswanathan describes the advantages of his product:

Point of sale systems have under-served retailers because, until now, they’ve simply been glorified cash registers. There’s massive potential in equipping these owners and managers with real-time insights about who is in their store, what customers are saying and what they’re buying.

Own has been testing the system with 20 beta clients in the Detroit area since July. Its system can work with existing cash drawers and printers. Own is now preparing a bigger push with merchants as it looks to get the word out about its tablet-based system.

The move to San Francisco will help the company as it looks to build up its engineering team and coordinate with partners, retailers and investors. The company is also adding additional advisors to its advisory board, including Shail Arora (Vineyard Capital), Raul Vejar (Head of Corporate Strategy, SAP) and Nik Harris (Head of Integration, North America, InMobi), in addition to Own’s first advisor, Peter Chane (Director of Business Development, Google Chrome OS), and Scott Crosby (Co-Founder, Google Analytics). The company has also added Bob Stefanski (Co-Founder, Tibco) to its board of directors, alongside Jake Cohen (Detroit Venture Partners).

Again, this is a tough market to crack, and many business owners are just making the step up to apps and dongles and may not be prepared or have the resources to go with a broader system like Own’s. And companies like Erply and Verifone, with its Global Bay purchase, are trying to do more than just accept payments by providing a suite of apps and software that can help businesses manage inventory and customer relations without forcing them to buy a dedicated device. But the company may find a market with business owners who want a one-stop shop for handling their business needs and like a device that is designed for a single overarching purpose. There’s an opportunity to redefine what the point-of-sale terminal of the future looks like, and Own has a chance to be part of the conversation.

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