Mobile payments wars heat up as Microsoft prepares to join the battle

According to USA Today, Faisal Khan, a banking and payments consultant at Faisal Khan & Company, has uncovered documents showing that the Nationwide Multistate Licensing System (NMLS) in Idaho has awarded Microsoft a money transmitter license.

Another document shows that Microsoft Payments has also registered with the US Treasury Department’s Financial Crimes Enforcement Network (FinCEN) as a money transmitter and provider and seller of prepaid access in all 50 US States. No other States have awarded the company a money transmitter license yet.

The Idaho license and FinCEN filing are indicators that Microsoft intends to enter the mobile payments market to compete with offerings from Apple and Google.

Microsoft’s application for money transmitter licenses is perhaps not such a surprise in view of recent announcements by the company. In March 2015, Microsoft unveiled that the mobile version of its forthcoming Windows 10 operating system will include support for host card emulation (HCE). HCE allows for credit card information to be transmitted between a user’s smartphone and a payment terminal without the use of a secure element (SE) embedded in a carrier-supported SIM. The company has also said that Windows 10 would support biometric access and facial recognition, both of which can be used to secure mobile payments.