Commentary

The Road to Using NFC for Mobile Payments

The use of NFC for mobile payments is a bit of a chicken and egg battle.

Companies involved in mobile payments want to use NFC-enabled phones but most people don’t yet have them.

However, the global volume of NFC-enabled smartphones will more than double this year, according to Strategy Analytics, and this without Apple yet being on board.

Next year, the number of NFC-enabled devices will pass 500 million, according to ABI Research. Bottom line is there will be a lot of phones with the technology in the foreseeable future.

Much of the talk of NFC is around mobile payments, since it seems to be the most publicized information about the technology..

But I wonder if it will be all those other uses outside of mobile payments that will tap into the technology.

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From a consumer standpoint, knowing about NFC for mobile payments via NFC is hardly front of mind. More likely, consumers will be attracted to other things that can be facilitated by NFC.

The latest Samsung commercial is a good example. When a person taps their phone to another person’s to share a photo or video, the transfer is instant. Consumers get that.

The reality is that in addition to mobile payments, NFC can be used for many small but useful other things, such as consumer aids.

NFC is being used in many transit systems, such as in Tokyo, France, Singapore, China and New York for automatic purchase via smartphone. Experiments have been run in cities like London where consumers can tap a phone to see the travel time of a particular bus.

In Madrid, about 500 bus stops have NFC tags so passengers can see arrival times and tourist information on their phones.

NFC will proliferate into many places, such as on packaging in stores and on publicly-displayed posters.

While most of these aren’t related to mobile payments, they all are tied to consumers using the capabilities provided by NFC technology.

Using the technology for mobile payments may be closer to the end of the NFC road, not the beginning. Where do you see it playing out?

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