Vodafone & Visa To Offer NFC

Vodafone and Visa have announced a deal to bring NFC to the masses this year using your smartphone.  Orange have been actively promoting NFC since joining Everything Everywhere group especially and now Vodafone are getting in on the game

Full (and long) press release below….

Near Field Communication, or NFC technology, is well and truly being foisted upon the paying public. Whether they like it or not, the ultra-convenience of waving your smartphone to buy has been picked up by Barclays, and now, Visa.

Mobile carrier giant Vodafone has signed on the dotted line with Visa so that it can use Visa payWave. The feature, which acts as a mobile wallet, will be available from Spring. Users terrified of the security implications might be reassured that, for purchases over £15, the customer will be prompted to tap in a pin code.

The world has been told by Vodafone chief exec Vittorio Calao that NFC payments will be “the next stage of the smartphone revolution”, reports the Press Association.

Although most devices on the market right now are not equipped with NFC, it has long been tipped as the next big thing. NFC payments will offer an easier way for customers to spend their hard-earned, in much the same way as the London Underground has Oyster Card readers.

Is the world ready for – or does it want – Near Field Communication for mobile payments in phones? Manufacturers, carriers and credit card companies will, no doubt, be rubbing their palms together over the prospects of profits. In the end, it doesn’t matter what Joe Public thinks – NFC is going to be on tonnes of phones, soon. Barclays has already detailed its own service and we can expect more to come.

According to Catherine Haslam, an analyst at industry-watchers Ovum, NFC and payments really are a “chicken and an egg situation”. Mobile payments are seen by device manufacturers, says Haslam, as the catalyst for the consumer to buy new devices, while service providers see the devices as a catalyst for service take-up.

“The third point of impetus could come from retailers and others with control over PoS equipment such as transport service providers,” says Haslam. “Just like the deployment of chip and PIN bank cards, NFC is likely to be supply rather than demand driven. Given that NFC is becoming commonplace in new mobile handsets and replacement and upgrade cycles are shortening, if enough NFC equipment is installed then services will start to be used.”

Visa has been active in promoting subsidising upgrading PoS equipment, according to Haslam, so there is some momentum. “However, in general, global terms,” she says, “because the benefit in speed is marginal and is not really recognised by consumers, the majority of retailers are slow adopters.”

If deployments are going to be worth it on a wide scale for retailers, Haslam says retailers will need to find service value beyond the convenience and speed that NFC provides. “This could either be for themselves in terms of greater loyalty and customer information, or for the consumer in better deals and service,” she suggests. “Increased security is one possible option but the one Visa and others are talking to retailers about is combining the payment and loyalty card functions to offer more targeted special offers to specific customers, to further increase loyalty and the value of each visit to a store.”

Speed of use will be worthwhile in some situations, for example, on transport or the London Olympics, where processing people as quick as possible does offer significant benefits. “However, this is usually being done with specialist cards such as Oyster in London rather than via mobile phone, as ubiquity and scale are essential,” Haslam says. “The exceptions as usual are in Japan, where NFC-enabled mobile phones have been used for some years, and Korea where they are also being used successfully in transport and other services.”

Though the consumer liked to use NFC in tests, carriers will need to work hard to generate interest. Haslam says that in France, which she says is the home of the smart card, there are already deployments and Visa has been working closely with Telefonica on trials. “People liked it when they used it, but had no real interest in trying it for the first time,” Haslam said. “Therefore, the marketing of services and some form of promotion that enables consumers to try services will be necessary.”

Link: TechEye.net