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Are NFC Payments Something That I Can Use?

One of the buzzwords in the realms of mobile technology at the moment is ‘NFC payments’, with talk of a near future where purchases can be made by simply swiping your smartphone over a terminal, keeping cards and cash in firmly your wallet.

The idea is enticing to some, with electronic transactions reducing the need to carry bulky cash around. Concerns have been raised about the security of such a payment method but trial schemes are running around the country, some of which have been permanently implemented.

The Post Office recently announced that it is to install NFC terminals in 11,500 of its branches across Britain – the largest roll-out of its kind in Europe. The first of these to be introduced will be around the Olympic Village in London and will see athletes housed there making contactless payments. Samsung has had a hand in this, gifting selected competitors with special editions of its Samsung Galaxy S3 handset that will enable them to utilise NFC technology to make transactions using Visa’s PayWave system.

So, what if you’re not an Olympic athlete but still want to have a go at using your phone to pay for things? Well, there are a few options available to the general public.

Orange has led the way in bringing contactless transactions to cheap mobile phones by introducing a version of the Samsung Tocco Lite set up to deal with NFC payments. Users can link a Visa or Mastercard account to the phone and use it to make payments of up to £20 at many outlets across Britain, including branches of McDonalds, Subway, and Little Chef.

Users worried about security can protect their transactions by setting the service to ask for a PIN before completion, but basic operation involves simply swiping the phone against an NFC terminal. The service works in the same way as pay as you go phone tariffs do, with the user topping up their account with cash before spending it. Orange even alert subscribers when their balance is low.

Mastercard has also announced that it is moving towards enabling mobile NFC payments. The credit giant has been running its PayPass system for several years, mainly using cards fitted with NFC’s rival system, EMV. Mastercard has recently approved a number of leading handsets to be used with its mobile payment system, including HTC’s One X and several BlackBerry devices. Payments will be governed by a mobile app called PayPass Wallet, set to be launched towards the end of this year.

Users without NFC-enabled phones do have options as well. Barclaycard recently introduced its PayTag service, which sees customers issued with a card fitted with an NFC chip which can be attached to a mobile phone. Although there have been some criticisms of the service, mainly that the card can be used independently of any device and there is no actual need to attach it to a mobile device, it provides an interesting stop-gap for Barclaycard customers until mobile NFC payments become more common. However, the service isn’t particularly accessible – a Dialaphone staffer recently tried to sign up for it and was informed that a wait of 6-8 weeks could be expected before receiving the card.

The introduction of NFC payments seems to be gathering pace though, led now by the financial companies who will be managing the accounts from which payments are made. Whilst several mobile manufacturers have recently built NFC functionality into their handsets, the support of the finance sector is key in order for the payment network to fully take off. The introduction of trials and full services is sporadic at the moment but with the technology out there, it won’t be long until we see more companies utilising NFC technology.

Written by Chris Helsby, technology writer at Dialaphone.

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