September 21, 2012
Reaching for your wallet is taking on new meaning in an Internet world. The phrase used to mean putting a hand in your pocket or your purse, but digital wallets are quickly making this language obsolete. In fact, cellphones and PDAs that enable payments to be made directly from your credit card and bank accounts are almost here.
It sounds simple enough, but it’s anything but. "These new technologies create a host of opportunities to the point where there is essentially a revolution about to take place," said Peter Aziz, a corporate lawyer with Torys in Toronto.
The revolution is directly linked to the new way of paying for stuff. In order for a payment to be accepted, information about the owner of the account and the account itself must be stored somewhere accessible: a SIM card or in the clouds. This opens up a wealth of information about an individual and, therefore, a wealth of opportunities for marketers — and fraudsters.
New technology also raises issues of privacy. For example, with the new technology, a person’s location can be pinpointed to within 10 feet of where they are anywhere in the world. Companies can use this to help make a sale by making their product, service or place more attractive to you. "Music can change as you walk into a store," noted Aziz, a member of Torys’ Financial Institutions Practice and the Payments and Cards Practice Group.