MasterCard says that its new RFID-based payment system, called PayPass, is headed toward a roll-out nationally in the U.S. But the roll-out will be in stages on a market-by-market basis. It already has been piloted in local markets in Florida and Texas.

The PayPass contactless payment system marries together the MasterCard credit system along with either an RFID-enabled plastic credit card or some other tagged item. According to a MasterCard spokesperson, Betsy Foran-Owens, as quoted in an article in Contactless News:

"As issuers put MasterCard PayPass into their cardholders hands, they will have made strategic decisions, based on their individual business cases, about what device will best serve them and their customers. Some may choose cards, others may choose alternatives to cards including fobs, tags and cell phones (as in the Dallas trial). Either way, MasterCard and the vendor community are working with our customers to issue quality solutions that will deliver against the MasterCard PayPass promise of speed and simplicity of use."

Here's the remakable thing. The PayPass system is not just about lowering costs or improving efficiencies, as many of the RFID implementations are. In this case, using RFID can actually increase market share. It has the potential to do so for MasterCard.

It turns out the new contactless system is way speedier than cash, even. Consequently it is being used in situations where credit cards previously have not been widespread, according to Foran-Owens:

The "...benefit of MasterCard PayPass is maximized at quick-pay locations, rather than traditional retail stores, that were formerly the bastion of cash transactions. Our merchant efforts have been focused therefore on these types of merchants. PayPass is the perfect payment solution in areas where speed is essential, such as movie theaters, fast food restaurants, and gas stations."

For more information on the MasterCard PayPass system, check out the Fact Sheet.