NFC is hot right now. It has been on the radar and in the headlines for quite a while now in much of the tech world. Square, Apple, Google, and many others are juping right into the deep end, investing millions into what it thinks is going to be the next great eCommerce revolution since Paypal. People will never have to carry credit cards ever again, and queues will move faster than anyone could ever imagine.
Slow Down.
NFC is brilliant for somebody like me or the many that love new technology. Processing rapid payments wihtout having to bring cards around is really nice. I could see myself using this all the time especially because I hate carrying cash and I dont always have my wallet with me. I do however, always have my phone. The problem is that other than the people who avidly follow technology, the rest of the world is not as quick to adopt such drastic changes. In fact, they are painstakingly slow to adopt such things.
For example, look at Netflix. They saw the future a long long time ago. They knew streaming was going to be the future of television and movie rentals. They offered streaming through the Xbox and computer before almost everyone else. The DVD mail service was supposed to be the bridge to getting people to switch to streaming. However, people really arent crossing that bridge very fast.The DVD mail portion of the business is still at the core of their existence all do to the fact the general public is far slower to adopt radical changes in technology than we think they are. People hate change.
This is where NFC payments comes in. This is a very big change for most people. Most people will have significant questions regarding the security and more importantly usability. People are more skeptical (and rightfully so) about how their money is being processed than ever before. The other problems lay with the infrastructure.
PC week describes the largest hurdles facing the NFC technology and I agree with all of them.
The problem with trying to jump on the NFC bandwagon right now is that there are too many bandwagons. You know how some businesses accept Discover Card or American Express while others don’t? That same sort of fragmentation exists with NFC implementations, making it confusing for businesses to choose which NFC solution to support.
Many businesses, such as McDonald’s, Walgreens, and Cinemark Theatres already have payment terminals capable of processing contactless transactions from cards like the ones offered by Chase. A business can embrace the Apple NFC system if it comes to fruition, but that would seemingly limit the value to only customers carrying NFC-capable iPhones or iPads. It might be nice, but it’s too limited a population of customers.
For maximum efficiency, contactless payments are typically for smaller purchase that don’t require a signature–under $25. For this reason, businesses that deal in higher average transactions probably won’t get much benefit from NFC, while restaurants, coffee shops, and other smaller businesses are more suited to take advantage of it.
My take
As you can see, I think we have a long way to go before NFC payments become the norm. Credit cards are not dead yet and probably wont be for a while. I think this change will take the better part of the decade, if they even become the norm. Who knows, with slow adoption rates, some new e-payment system within the next few years could completely wipe NFC off the map before it even has a chance to grow. I think there are certainly questions about the security that need some answering and I also don’t see how the credit card will die if these payments are really only to be used on things that cost less than $25. How are people supposed to buy more expensive items? O yeah a credit card. Certainly retailers should start to think about how they are going to prepare for this change if it comes, but I think they have plenty of time before they have to start making decisions.
Would love to here everyone elses take on NFC payments.
Ryan G. Campbell 