August 18th, 2015 by Elma Jane
NFC stands for near-field communication, it allows two devices to share data.
You’ve likely used it already, even if you haven’t realized it. It’s embedded in computer cards, print ads, smart cards and it is featured in many Android phones, Windows phones and the new iPhone.
NFC works in two ways:
The first is two-way communication, where two devices can read and write each other – like transferring contacts or photos from one device to another. The second is one-way communication where a device can read and write to an NFC chip – similar to using an NFC enabled card to pay for something using an NFC terminal.
Sure there are other technologies, like Bluetooth, that can do things similar to NFC, but NFC uses less power and is better for your smartphone’s battery life. NFC is also less complicated to use than Bluetooth and doesn’t need to be paired with anything.
NFC is extremely secure. Intercepting payment information from an NFC device is very difficult because of how the process works. To use NFC for payments, the payment application is first launched on a phone that is then tapped on a terminal. The customer then enters a code or scans a fingerprint to approve the transaction. A secure element (SE) then authorizes the payment and sends the information to the NFC modem. The payment is then processed like a credit card swipe.
NFC is likely to continue to grow in popularity in the mobile payments space, to learn more about NFC payments and how you can prepare your business with National Transaction Corporation, visit www.nationaltransaction.com or give us a call at 1-888-996-2273
Posted in Best Practices for Merchants, Near Field Communication Tagged with: credit card, Mobile Payments, Near Field Communication, nfc, NFC payments, payments, swipe, terminal
June 26th, 2015 by Elma Jane
As you can tell from the name, Android Pay playbook is remarkably similar to Apple Pay. Android Pay will use an on-board Near Field Communication (NFC) chip and tokenization services from the major networks to deliver a token from the phone to an NFC-enabled point of sale. Just like Apple Pay. Android Pay is supported by more than 700,000 merchant locations and Android Pay will provide APIs for app developers to take in-app payments from the on-board wallet. Both Apple Pay and Android Pay have fingerprint scanners on phones, you can enable payments with just a fingerprint scan.
While details are barely sufficient, rumor has it Google won’t charge banks a fee as Apple does on the transactions and that’s the difference. Additionally, technical differences in the operating systems underlying the payment system exist, but they won’t affect how every day users experience the system. Android Pay will suffer a slower upgrade path than Apple Pay, due to the lack of hardware support for the newer operating system (it can take Android twice as long to get users upgraded).
There is no war between Apple and google. NFC won the war! We are seeing all of the armies gather together under its flag. As consumers, we love to see better products. When it comes to payments, we need standards and reliability.
With the alignment of the two operating system platforms on NFC, on user experiences like fingerprint unlocking and on both in-app and retail payments, consumers, retailers, and app developers can build an ecosystem we can all understand. Credit cards work great because they are ubiquitous. Everyone can use them everywhere, and every retailer has incentives to be a part of the system.
An NFC-based mobile payments experience will have this same effect. Over the next five years more and more retailers will add NFC-capable terminals. More phones will be fully capable of NFC payments with fingerprint sensors. More consumers will carry those phones.
So if it’s not a war, are there any losers? Companies focused on plastic cards, but not NFC. Transitory technologies like Samsung Pay’s MST (magnetic secure transmission) also have a strong transition period as they enable payments at non-NFC enabled terminals. MST (magnetic secure transmission) is a strong player because the user experience is very similar (hold a phone to a reader), even if the technical method is not the same.
Posted in Best Practices for Merchants, Near Field Communication Tagged with: banks, chip, credit cards, merchant, Mobile Payments, Near Field Communication, nfc, NFC payments, NFC-capable terminals, NFC-enabled, payment system, payments, point of sale, tokenization
