That smartphone in your pocket might soon replace your credit card.

Dozens of wireless carriers, handset manufacturers and Silicon Valley start-ups are working toward that goal, fueled by the massive adoption of iPhones, Androids and BlackBerry models. The idea is that instead of reaching into your wallet for your credit card, you’ll instead drag out your phone and swipe it to pay — either via embedded software in the phone itself, or a small chip that attaches to it.

Market tracker Juniper Research says one in every six mobile phone users will have a phone able to make mobile payments by 2014.

•AT&T, Verizon Wireless and T-Mobile formed Isis, a mobile payments network launching in 2011 that will let subscribers pay with smartphones.

•Google’s upcoming update to its Android phone system software will include technology to pay bills via an embedded chip, the company said.

•Start-ups Boku, Obopay, Zoompass and Square all offer ways to pay for goods with smartphones.

One start-up sure to get more attention is in Palo Alto, Calif., a few miles from the headquarters of Google and Apple. Bling Nation, which services the “local” section of PayPal’s app for the iPhone and iPad, has signed up the city of Palo Alto, Stanford University gift stores and dozens of merchants on University Avenue, the city’s main drag.

Customers attach a small Bling chip to their phone. To pay, they swipe the phone/chip at a Bling terminal near the cash register. That taps their PayPal account for the transaction. EBay owns PayPal.

“Everybody always has their phone on them,” says Jean-Paul Coupal, who runs the Coupa Cosas coffee shops in Palo Alto. “The wallet, sometimes they leave it. It’s bulky. But paying with your phone is nice and easy.”

At Sprouts Cafe in Palo Alto, Bling is used for 20% to 25% of transactions after only two months. “I am amazed” by the response, co-owner Tina Almendras says.

The advantage for retailers: Bling charges a fee of about 1.5%, about half the usual credit card fee. “That’s a big savings,” says Tommy Fehrenbach, manager of economic development for the city, which encourages citizens to pay utility and parking bills via Bling. “It really helps the bottom line.”

Bling is also accepted by a handful of merchants in San Francisco; Lamar and La Junta, Colo.; Clarksville, Tenn.; Saratoga Springs, N.Y.; and Mount Pleasant, Texas.

(Source: USA Today)