We use our smartphones for everything, from taking photos and video to mobile banking. So why not replace your wallet with your phone? That’s a change that could be coming sooner rather than later now that MasterCard and Visa have endorsed a new mobile payment technology.

The tap-to-pay technology is already built into KitKat, the latest Android mobile operating system, and an endorsement by two major credit card companies means host card emulation (HCE) could be replacing your wallet soon enough, Re/code reports.

HCE allows payment card information to be stored in the cloud, letting mobile apps access the information without using the secure element hardware embedded in the phone. Previously, mobile carriers have been able to control who gained access to the secure element, thus limiting the apps consumers could use for transactions. With HCE, consumers can bypass restrictions since mobile carriers can’t control the cloud.

MasterCard and Visa’s announcement backing the payment approach opens the door for banks and retailers to build payment features into their mobile apps. Since consumers already trust banking apps to complete transfers and deposits, they will likely be able to convert users to the tap-to-pay method.

Both credit card companies will publish specifications and standards for use of the new system, while continuing to safe-guard consumer information.

Even with Wednesday’s announcement, substantial use of tap-to-pay transactions could be a few years away. Currently, only about 25% of large retailers and 5% of small retailers use the system.

How MasterCard and Visa Just Made Banks the Next Big Players in Mobile Payments [Re/code]

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