NFC, or Near Field Communication, is a wireless technology that allows two devices to communicate with each other over a short distance. This communication is able through interacting electromagnetic radio fields. This technology could allow users to download coupons as they walk into a store (a la Google), or get information from interactive posters, much like a QR code. Other uses include tap access into secure areas or passing information from phone to phone, similar to Bump, which uses location-based technology.
NFC is like RFID, Radio Frequency Identification, but with chips that are “smart” on both sides – usually the RFID chip can only do one thing, store data to be read or read data. NFC goes a step further and puts the chip into something that can compute (your phone) so that it can download a coupon or your business card and put it on the chip before it is read by others. For example, MasterCard\’s PayPass uses an RFID chip that stores your credit card information. When you tap your PayPass card against a reader, your payment information is sent to the merchant, just like a normal credit card transfer, except this is much faster – no swiping or signing involved.
This might seem like deja vu for some people since this isn\’t the first time America has gotten a taste of NFC. In 2005, Chase held a trial with sports fans at Philips Arena in Atlanta. In 2006, Cingular and Citibank conducted a trial with the New York City subway. And in 2008, Sprint held a trial with the BART system in San Francisco. There have also been a number of internal and smaller-scale trials from other banks and mobile wireless carriers. Despite positive results, there still wasn\’t enough support from mobile carriers, banks or retailers, so manufacturers held off on rolling out NFC hardware. Security concerns were raised then and are still a big source of discussion today. So many companies have hopped on the bandwagon and are working on their own NFC-capable whatever, but no one has stopped to address any of the privacy concerns. It seems everyone is too focused on being the first.
NFC already works with some RFID readers, but most will need new hardware and existing phones will need NFC technology built in. So even if a bank is ready, it doesn\’t matter if your phone isn\’t. Many trials are supplying users with a new phone, or a case for iPhone users with a micro SD card. For this to become commonplace in our world, everyone would have to buy a new phone.
Instead of waiting for more NFC-capable phones to hit the market, Kuapay is moving forward by creating a downloadable application that uses a QR code to initiate the mobile payment. You can read more about how our QR code works here. Once initiated, the customer selects the card they\’d like to use and approves the payment. The rest is done automatically and the receipt is already on your phone. Kuapay will eventually work with NFC-enabled hardware. But in the mean time, you can take advantage of a safe mobile payment experience.