Reliance announced a mobile wallet service ahead of its GSM competitors for a potential base of 1 to 2 million of its subscribers that are also accountholders with HDFC Bank.

The Reliance mPay feature can be activated over the R-world portal to make contactless payment initially with Reliance-held companies, such as Reliance Energy, Reliance Power, Adlabs Cinema and the Yatra travel portal.

Another 100 merchants will be recruited on this scheme over time, necessitating a reconfiguration of almost 300,000 POS terminals nationwide. At the merchant end, the sale could also be approved over a handheld Reliance phone. The credit payments appear on the standard monthly bill issued by HDFC.

The three-step transaction uses a PIN issued with the virtual credit card and dispenses with entry of card numbers, card verification values or expiry dates. If the mobile phone is reported as lost, the mobile wallet is also disabled. The subscriber’s phone number acts as the credit card number and can also also used for internet and IVR-based payments.

“This initiative goes beyond mobile payments, and in fact, makes the mobile phone a credit card”, says Mahesh Prasad, president of Reliance Communications’ Applications, Solutions and Content Group. He said this was the world’s third mobile wallet implementation.