V.me is Visa’s attempt at creating a digital wallet that makes transactions easier. It allows users to pay online with a Visa or other credit card using a user name and password instead of entering a 16-digit card number and their address. V.me is available online and on mobile and will roll out to in-store point of sale next year.

Visa is relying on banking partners to help sell V.me to their 50 million customers. It has signed up deals with PNC and U.S. Bank along with about 50 other smaller banks, who will offer V.me directly to their customers. Some like PNC will offer a preloaded V.me wallet while other banks will send users to sign-up through the V.me site. Many banks will market the service through their own banking site.

V.me also has about two dozen merchants partners, including 1-800-Flowers and Shoebuy.com, Cooking.com, Rakuten Buy.com, Blue Nile and others. It’s looking to eventually target the top 250 online retailers. That would pit it against PayPal as well as other credit card rivals like American Express and MasterCard, which are also creating or building out digital wallets to make it easier to pay online.

The bigger challenge and opportunity will be in 2013, when V.me goes in store. Jennifer Schulz, global head of eCommerce for Visa, said the company is looking at employing near field communication (NFC) in certain geographies though it’s also looking at other technologies to facilitate payments. She said V.me could easily plug in other tools at the point of sale like QR codes.

V.me represents a way for Visa to go multi-channel, selling online and offline. That’s especially helpful in mobile commerce, where completing transactions can be hard. But if Visa can expand its share of in-store sales, that’s an even bigger opportunity though it will have to go up against a lot of competitors including Google Wallet, Isis, Square and many others. Visa hasn’t shared any numbers from V.me’s beta so it’s unclear how well consumers are taking to the wallet so far.

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Buy.com’s 18 million customers will now see the option to enroll in V.me on check-out and login pages. They will be able to create a V.me account that’s funded from Visa, American Express, MasterCard and Discover cards. Instead of entering in their credit card information to complete a transaction, V.me users can enter in a user name and password. V.me users can also receive alerts and near-real-time notification of transactions on their Visa accounts and will eventually get personalized offers through the wallet.

This is still an early step for V.me, which got going with the launch of a developer center in November. The plan is to start in the U.S. with online commerce, with many more retailers set to support V.me in the coming weeks and months.  Eventually V.me will expand to mobile and in-store payments using near field communication. Visa Europe also announced last month that V.me would debut this fall in the UK, France and Spain.

V.me seems to be getting off to a bit of a slower start than expected. In November, Visa announced that V.me would launch in the U.S. in early 2012 after the holidays with in-store NFC payments coming later in the the year. It’s unclear when V.me will be ready for a public launch for all online retailers. The NFC roll-out will be even more complicated and will pit Visa directly against Google Wallet and Isis, the wireless carrier-led wallet initiative set to begin trials this summer in Austin and Salt Lake City. It’s also facing competition from MasterCard’s PayPass Wallet Services and American Express’ Serve platform, which will eventually both offer online, mobile and in-store payments.

This battle is starting to heat up but don’t expect this year to be decisive. There is still so much education and development that needs to happen and most consumers and merchants don’t have a clue as to which wallet they will want to use. Visa has the advantage of being the biggest credit card network and that trust will surely give it a boost in the new digital wallet wars. But there’s so much more game to be played, it’s still too early to say who will prevail.

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V.me will start as an online payment system, allowing people to pay for goods through their PC, tablet or smartphone. Consumers will be able to load various credit cards, not just Visa cards, onto the wallet and pay using a simple user name and password. The goal is to eventually make it a tool for real-world offline payments using NFC (near field communication) technology, though it’s unclear when Visa is planning on rolling that out.

“Our intention is that V.me will ultimately be able to incorporate any or all of our new payment technologies, allowing our members to deliver the best possible payments experience whether face-to-face, online or in a mobile environment,” said Mariano Dima, Executive Vice President of Product and Marketing Solutions at Visa Europe, in a statement.

Visa Europe will partner with payments processor WorldPay, which will help ensure that that the digital wallet service meets the needs of UK retailers. More banks and retail partners are expected to be announced in the future.

In November, Visa announced that V.me would launch in the U.S. in early 2012 after the holidays. But so far, there hasn’t been any indication as to when that will move forward. Visa also said it expected to add in-store payments using NFC later in 2012, but again, it’s unclear if that timeline has also slipped.

Still, it shows that Visa is moving forward on its next generation payment services and continues to advance on several fronts. It has V.me, of course but it’s also partnering with Isis and Google Wallet and has backed Square. And it’s also working on launching a big NFC payment system at the London Olympics this summer with Samsung.

As we’ve mentioned before, the credit card companies and banks are still in a very strong position in the mobile payments game because they have a very trusted relationship with consumers. And while Visa is still slow in rolling out V.me, that might not be a bad idea. It’s very early in the mobile payments game and leader Google hasn’t seen much benefit from getting out of the gates quickly.

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