Visa is making “strategic investments” in a technology startup that hopes to use sound waves to compete with Apple Pay and similar platforms.
The startup, LISNR, announced that Visa took part in a closed Series C venture capital fundraising campaign. Visa is also reportedly working with LISNR to beta test its payment platform with retail merchants.
LISNR’s mobile payment platform is based on ultrasound technology.
More specifically, LISNR is developing a way to transfer data using sound waves, which could be used for authentication and mobile payments.
“The way in which people are paying for things will dramatically change,” LISNR cofounder and CCO Rodney Williams told CNBC.
Williams said that his firm’s ultrasound technology carries a number of benefits over existing mobile payment platforms.
- The tech is apparently much safer and more secure than QR code payments, which is favored in China but is easily compromised.
- It’s also quite a bit cheaper than the expensive near-field communication (NFC) tech that Apple Pay, Samsung Pay and Google Pay use.
That could be a boon to speed up the adoption of contactless payment platforms in the U.S. — which has lagged behind the rest of the world. Part of the reason for that is that merchants need to buy the proper hardware to accept Apple Pay or other mobile wallet tech.
“Our true advantage over NFC is that LISNR is all software and not restrictive to the OEM,” Williams said, adding that NFC is OEM-restricted while the LISNR technology would be more open.
NFC works a lot like Bluetooth or Wi-Fi in that it relies on the transfer of data over radio waves. LISNR’s system, on the other hand, uses sound waves in a proprietary “data-over-audio” system. Importantly, those sound waves can be audible or inaudible to users, depending on the circumstance.
Williams also called the Visa investment and partnership a “major validation and also a market signal for the world of payments” — an area which he says is ripe for disruption.
Whether that will turn out to be the case remains to be seen. While Williams declined to name any retailers involved in the beta, LISNR’s press release claims that the company will work to drive the payment standard in 2020.