The mobile payments provider New Media Insight Group is expanding its mCard virtual card technology to Seattle and Chicago, following initial rollout in Arizona in November. The Phoenix -based company said it might add three more cities by the end of 2014.

An mCard is a one-time-use virtual MasterCard prepaid card that is funded from existing bank accounts or credit cards. The cards are generated on a smartphone and have a lifetime of 20 minutes. They can be used for payments via NFC-enabled phones, by reading QR codes or by displaying the card number on the phone so it can be typed into the merchant terminal.

The protection of customer data is an important benefit of using mCards, since no account information is exchanged with the merchant, New Media Insight said.

The other use of mCards is for merchants who brand an mCard and combine it with a loyalty and incentive program. Customers can also be offered the option of contributing their merchant awards to a non-profit organization.

For example, an elementary school in Arizona used branded merchant cards to raise funds. Sponsoring merchants contributed 1.5 percent of all purchases made with their branded mCards to the school.

"The success of mCards reflects the compelling value proposition they offer retailers and non-profits looking to build loyalty programs and consumers looking for a safe and easy way to shop," New Media Insight Group's CEO Michael Palethorpe said in a news release.

Learn more about loyalty programs.