NFC is here!Well, maybe still a few months/years away of being thoroughly defined and reaching all regions and operators worldwide but trials have certainly started and big brands are looking into solutions to adjust their mobile payment offerings on this technology.
In the UK, mobile carrier Orange announced the first mobile phone contactless payment service in the country back in May this year. The app is called “Quick Tap” and you need to have a Barclays credit or debit card in order to use it. If you meet the requirements then you are ready to pay with your phone in more than 50.000 locations whether you want to pay in McDonald’s or to drink a Cappucino thanks to your phone in Pret a Manger.
In the meantime in the US, the Isis telcos (Verizon and AT&T, the two largest carriers in the US are part of this consortium) are key in the evolution of NFC; Companies with mobile platforms such as Google which recently announced their mobile wallet based on this technology and which is currently only supported by Sprint, will have to collaborate with the consortium if they want their solution to reach the majority of subscribers with Smartphones in the US. One of the main problems faced by these mobile platforms, is the lack of experience regarding regulations in mobile payments, implementing the level of security for this type of transactions, etc. Although, no doubt, give them some time and theirs will probably be the most popular and successful options.
Companies specialized in payments and financial services such as Visa, MasterCard and American Express don’t want to fall behind either, and take the risk of not being a strong competitor on this field by solely sticking to pure credit and debit card payments; This is why all of them in one way or another are starting to build their own solutions or partnering with other companies to do so.
Visa Mobile Contactless Payment solution was certified for commercial use at the end of 2010.This solution was included in the list of Visa compliant products available for potential commercial deployment by financial institutions in the U.S. and selected markets. Some of the Smartphone models compatible with their solution? BlackBerry® BoldTM 9650, the iPhone 4, the iPhone 3GS, iPhone 3G, and the Android based Samsung Vibrant Galaxy S.
On the other hand, MasterCard has been looking into mobile payments since 2001, according to James Anderson, VP of Mobile at MasterCard. The company introduced “PayPass” back in December of 2002. They run a trial for this “contactless” payment program in a few markets with banking customers such as Citibank. Some brands such as McDonald’s started accepting this payment form back in 2004. It was that year when MasterCard also worked with Motorola to start testing NFC technology. Since NFC is based on existing contactless infrastructure, Paypass is a very important step towards this field. Through 2009 and 2010 Mastercard performed trials with Near Field Communication. Currently, MasterCard is working on different initiatives involving NFC (rumors of MasterCard’s involvement with Google and Citibank to build a Google-branded mobile payments system?) that will continue through 2012 and will definitely be a powerful option for mobile payments.
American Express? Yes, it made its first move towards NFC payments launching “Serve“, their digital payments platform.