Mar 1, 2006 12:00 PM, Patricia Odell

A customer walks into Wal-Mart and buys a set of dishes by swiping their cell phone — which has been loaded with the shopper's credit or debit card information — past the checkout scanner. A day later, a text message arrives: a coupon for $20 off a new set of silverware redeemable at Wal-Mart.

Sound like something out of Back to the Future? No so, if Motorola has anything to say about it.

The company is developing a new service, called M-Wallet, that will allow cell phones to double as credit or debit cards. Credit information, downloaded to subscriber's phones, will let people make purchases with their mobile phones.

Motorola says the technology will offer two main benefits to consumers: financial and lifestyle capabilities.

As for financial benefits, users can pay bills, manage their finances, transfer money to friends and make purchases.

On the lifestyle side, users can order airline or movie tickets or purchase prepaid airtime or shopping cards among other transactions.

Participating merchants can tap the small screen to serve up a host of offers and promotions via an opt-in service. The new technology can act as a loyalty builder, offering virtual loyalty or gift cards or allow users to collect loyalty points. Coupons, sweepstakes and other promotions can be offered based on consumers' retail preferences.

“With this application, it's just a different click of a button that will take your from one menu to the next,” says Motorola spokesperson Kathy Wiesner. “You can be making a point-of-sale transaction and then choose a different menu to transfer money and then select the next menu and do some online banking.”

Schaumburg, IL-based Motorola was in advanced talks last month to strike deals with wireless carriers, financial institutions and retailers willing to use the technology. It had three trials underway at a retailer that Weisner declined to disclose. The M-Wallet service could be downloaded from various cell phone companies Web sites and used on multiple devices, including Palm Pilots, Blackberrys and cell phones not made by Motorola.

The service is expected to be in consumers' hands in the second quarter, with scanning capabilities available within six to nine months once chips are embedded in the phones that can interact with the scanners.

Asia has seen the phone-as-wallet take off over the past year, but the service has yet to hit the United States.

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