World’s largest maker of cell phones, Nokia Corp. has made a huge investment in a California-based startup. The startup, Obopay Inc. is a startup which is working towards making mobile phone the credit card of the developing world.

Redwood City based Obopay Inc., made regulatory filing which mentions about the sale up to $70 million in preferred stock.  According to the same filing, Teppo Paavolo, Nokia’s head of corporate business development, will enter Obopay’s board.

Obopay’s service is present in the U.S. and India. Obopay allows users to pay each other using text messages or any other mobile phone applications. If you have a bank account or credit card account then the money can be routed from that account.  You can use this service even though you do not have a bank account. You can simple prepay the money into an Obopay account.

Obopay was created by Carol Realini. One main competitor of Obopay is eBay’s PayPal Mobile in the U.S. There are other competing mobile payment systems present today.

This is the first time Nokia is investing in such a service. Obopay will use the investment for global expansion and technology upgradation. In its prior capital raising activities, Obopay raised $69 million including $7 million in 2006 from Qualcomm Inc.

Nokia is already working on building transponders into some phones. Such phones can be swiped over payment terminals. Exxon Mobil Corp. already has such a swappable Speedpass key chain fob.

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