Westpac has warned that any attempt by the Reserve Bank of Australia (RBA) to develop standards for mobile payments would leave the country's users saddled with half-baked and underdeveloped technology.
In a submission (PDF) to the RBA's strategic review of innovation in the payments system, first reported by the Australian Financial Review, Westpac said that since mobile payments were still being explored by local financial institutions, it was still uncertain what aspects of the payment service might need regulation.
The bank asked that the RBA not jump the gun on regulation until the industry had a better idea of how mobile payments would look.
"At this stage, we have not identified regulatory hurdles. On this basis, regulatory intervention is unlikely to be helpful in stimulating investment," it said in the submission.
"The risk here is that an intervention will saddle Australia with sub-optimal technology," Westpac warned in its submission.
Local banking giants have recently tried their hand at enabling mobile payments using various incarnations of near-field communication (NFC) technology.
NFC facilitates the transmission of data over a range of approximately 10cm. An NFC-enabled chip in a mobile phone can interact with a proximity card reader to make mobile payments.
ANZ Bank recently wound up a trial of an NFC-enabled phone case that facilitated mobile payments. Westpac is working on an internal trial of an NFC-enabled sticker, which a customer would affix to their phone, while the Commonwealth Bank is set to release case-based NFC to the market in coming months. Non-bank providers are also racing to release mobile payment services, including PayPal, which will shortly bring person-to-person mobile payments to Samsung Nexus S.
PayPal and the Commonwealth Bank are two of the first providers to promise mobile payments to Australian customers outside of a trial program, while other providers are still in the internal testing phases.
ANZ Bank's trial of mobile payments in particular demonstrates the need for more testing, given that the bank told ZDNet Australia at the conclusion of the trial that the NFC cases hadn't lived up to its expectations, forcing it to take a new "wait and see" approach to mobile payments.