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Long-delayed mobile payment service Isis in trouble as Capital One pulls out

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One of the largest players in US mobile payments space may sputter before it even launches. Isis, a joint venture between AT&T, Verizon, and T-Mobile, has just lost one of its three primary credit card partners: Capital One. The bank told NFC World that "our pilot test with Isis will be coming to an end soon," adding, "We have gained valuable insights from our customers who were among the first to pay with the Isis Mobile Wallet."

Isis launched a Salt Lake City and Austin trial a year ago after a series of delays, and it plans to go nationwide by the end of the year. And while Capital One said in its statement that "We continue to engage with Isis on the future of mobile payments," it's extremely unlikely that the bank would abandon the trial just to rejoin when the service goes live across the country. American Express, Chase, and Barclayscard are Isis' other banking partners.

Mobile payments have largely failed to gain momentum in the US, with no frontrunner emerging from a complicated tangle of competitors. Google Wallet, like Isis, largely depends on secure NFC elements in smartphones, but the carriers behind Isis have prohibited Google from accessing the chips. And NFC is still only in a minority of smartphones, with Apple completely ignoring the technology. Isis plans to make iPhone, Windows Phone, and BlackBerry 10 support later this year, but the service also relies on retailers installing proper hardware at the point of sale. With one fewer banking partner, however, there's a seemingly slim chance of Isis becoming dominant in the mobile payment space.