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NEW YORK — I'm using my American Express card to buy coffee at Chobani SoHo in Manhattan. Instead of grabbing the card from my wallet, I place a key chain fob against the store's credit card reader near where I'd normally swipe plastic. I press a button. Success. Amex has been charged.

I shopped this way a lot these past few weeks testing a highly promising — and imperfect — new mobile wallet solution called Loop Fob. It went on sale for $39 recently from Boston start-up LoopPay.

Mobile payments are supposed to be the future. You pay for stuff swiping or tapping your phone, or in Loop's case with a fob that works in tandem with the Loop Wallet app on your iPhone. You can store all your credit cards, loyalty and debit cards, gift cards, and other forms of ID on your handset with Loop. You can also store your credit card issuer's phone number, security codes, pictures of the front and back of the cards, and even a digital replica of your signature. By storing it all on the phone, you can shrink your George Costanza-thick physical wallet down in the process. Of course, it will be a very long time, if ever, before your physical wallet completely goes away.

Proponents of mobile payments generally insist that tapping to pay is faster, more convenient, and arguably more secure than old-fashioned methods. And those proponents include tech companies, credit card issuers, banks and other financial institutions, even if they hardly agree on the best approaches.

Kickstarter alum LoopPay would appear to face stiff odds in the space, but it has come up with breakthrough technology that addresses one of the key hurdles stifling the growth of mobile payments, notably that merchants would have to cough up considerable dough to upgrade their existing point-of-sale terminals and credit card readers. But Loop is compatible, the company claims, with 90% of the magnetic stripe credit readers that are already out there, including many that have been around for years. (The most notable exceptions are card readers at gas stations and ATMs.) The beauty is that merchants don't have to replace or alter equipment or change the software. Loop emulates the magnetic field generated when you swipe a mag stripe against the card reader, thus transforming the terminal for such transactions into a "contactless" card reader. (Loop's founders are veterans of the industry.)

So we're talking genuine technological hocus-pocus. But does that translate into a better shopping experience? After all, we've been pulling physical credit cards out of our physical wallets for decades, and well-worn habits are hard to break. The answer is that Loop is, indeed, onto something, but I'm not convinced that the future is here yet. Loop's got to get simpler. And work in more places.

The first step before you can shop with Loop Fob is to store all the credit cards you plan to use in the Loop Wallet app. You do this by connecting the fob to the audio jack on your iPhone and swipe in the cards. The idea is you can then leave those physical cards at home.

Then when you're in the store and ready to make a purchase, you plug the fob back into the phone and open the app. You must enter your four-digit passcode to do so. You tap the screen to choose the card you want to use for the transaction, and place the fob on or very close to the credit card reader. You must position the reader onto the reader the right way or the transaction, as I discovered all too often before getting up to speed, won't happen. Either way this can get a tad cumbersome.

Fortunately, there's a considerably easier way that doesn't require the phone to transact. Loop lets you store a single designated credit card on the fob itself. Then you only need to place the fob against the card reader in the store and press the button on the fob to complete the transaction. Loop calls this feature "button pay," and it's how I paid at Chobani, and I suspect it's how most people who go, um, loopy will choose to pay most often. You do have to connect the fob to the phone if you decide to change the default card that you've selected.

If you lose the fob or it is stolen, keep in mind that when button pay is activated it is like losing the actual credit card. A crook could charge against the card until you call your credit card issuer to cancel. But your other cards are safe and sound inside the Loop app — without a passcode a thief cannot access your other card credentials, even if he gets hold of your phone and plugs in the fob. Through settings inside the app, you can choose when or even if to enable button pay ("always," "never," "8 hours," "10 minutes"). You might turn it on for 10 minutes when you give the fob (in lieu of a credit card) to a waiter when paying for a meal in a restaurant.

In my early attempts using Loop in New York and New Jersey, I got it to work at Starbucks and Dunkin' Donuts but not at a local bagel shop, Japanese restaurant or during two visits to the same RadioShack. Some of the problem was user error — mine. At one point button pay was disabled, and I didn't realize it. But even when the fob was attached to the phone, I didn't always position it properly around the credit card reader. Still, the onus is on Loop to better explain how to use it. (The good news is the company has instructional videos at the LoopPay site.)

As I got the hang of it, my success rate soared. I got Loop to work at a vending machine at my gym, at a CVS Pharmacy, and at a neighborhood grocer.

I returned to RadioShack and got it to work there, too. Third time's a charm. Only the clerk asked to see my physical credit card anyway — so much for saving time. In practically every case, though, shopkeepers were patient, curious and willing to fiddle with Loop to get it going. No one thought I was about to rip them off.

Coming in April is a potentially more convenient $99 case that incorporates Bluetooth, charges your phone, and of course lets you pay without the fob. An Android app is also due in April.

In the meantime, the battery on Loop Fob charges through USB and is expected to last between 200 and 300 transactions, the company says. When not attached to your phone, Loop Fob is protected by a silicon gel bumper key chain, which has the button you can press when you exploit the button pay feature. Loop eventually wants to see its technology in smartwatches.

Loop Fob simply needs to work in more places and occasionally with fewer hassles. But when it does work, it's a pretty cool way to pay.

Email: ebaig@usatoday.com; Follow @edbaig

THE BOTTOM LINE

Loop Fob from LoopPay

$39, www.looppay.com

Pro. Impressive and secure technology. Lets you pay with credit card accounts using just the fob or a fob connected to your phone. Merchants don't have to upgrade credit card readers.

Con. Still doesn't work everywhere including gas stations and ATMs, and sometimes takes a few tries even in places where it does work. You may have to swipe your cards multiple times before the app recognizes and stores those cards. Button pay only works with one default card.

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