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Device puts all your credit cards on your phone

Slowly but surely, real-world transactions are going digital -- just not necessarily the way futurists had envisioned. Right now, it isn't digital currency like Bitcoin that's leading the charge; instead, it's your smartphone.

For example, products like Loop Pay are enabling you to use your phone to make mobile payments without carrying your credit cards. Loop ChargeCase is an iPhone case (which fits the iPhone 5 and 5s) that works in conjunction with an iPhone app to store all of your credit cards and other cards (like debit cards, gift cards and loyalty cards). The case lets you make mobile payments at any point-of-sale terminal that you would ordinarily swipe a card.

Here's where it gets interesting. You don't actually swipe Loop, because no magnetic stripe is involved. Instead, the Loop case transmits a magnetic field that emulates the data embedded in your card's magnetic strip. You simply need to hold the phone close to the stripe reader and activate the transaction.

Loop ChargeCase costs $99 and includes a fob with which you swipe your existing credit cards (and other swipe cards). After entering all of your cards in your iPhone, you can leave those cards at home and rely exclusively on your phone. The app makes it easy to switch among different cards on the fly, so your phone can essentially act like any of your various cards at the touch of a button.

Moreover, the Loop case doubles as a charging sled, delivering about a 60 percent charge to your phone. Even if your phone and the Loop's iPhone battery are completely dead, though, the Loop case maintains a reserve charge capable of continuing to make mobile payments even if the phone itself is dead.

Loop also claims that Loop ChargeCase is more secure than your ordinary credit card. That's because all of your credit card information is encrypted, and access is password- and PIN-protected.

How compatible is Loop? According to Loop, it works with about 90 percent of stores and restaurants that use credit card readers worldwide. In the U.S., those numbers should be even more attractive, since magnetic stripe readers are ubiquitous here. Readers optimized for EMV-chip cards exist in only a handful of countries. (EMV stands for Europay, Mastercard and Visa, and relies on an embedded chip to authenticate mobile payments.)

Loop isn't the only product trying to modernize mobile payments via your phone. Loop is shipping now (The ChargeCase emerged from a successful Kickstarter campaign earlier this year.) Later this year, for example, Coin is expected to emerge from development and ship to its backers. Unlike Loop, which opted to build a device around the phone, Coin is a credit card-like gadget that stays in communication with your phone via Bluetooth, but is itself a swipe-able electronic card.

If devices like Loop and Coin prove successful among the consumers, you can expect to see more such devices. The technology appears to be sound. The bigger question is if consumers will have enough confidence that these gadgets are secure.

Photo courtesy of Loop

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