NFC payments: How they work

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Near Field Communication has revolutionised the way payments can be made. But how does it work, and what security measures are in place?

Near Field Communication has revolutionised the way payments can be made. But how does it work, and what security measures are in place?

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  • 1. NFC Payments:How they work
  • 2. Near Field Communication hasrevolutionised the way payments canbe made… but how does it work, and what security measures are in place?
  • 3. An Introduction to NFC payments:> Near Field Communication (or NFC) paymentspresent users with a chance to make cashlesspayments from associated credit and debit cardaccounts.> The concept of doing so isn’t a million miles awayfrom that of contactless payments, but using NFC,you can actually pay for items using your mobilephone.
  • 4. So how does it work?> To take it back a few steps, most modernsmartphones can use NFC to communicate withother phones or digital devices when within aradius of around ten centimetres (almost similarto how bluetooth has been used in the past).> This communication can be synced with creditcards, meaning it’s possible to pay for itemssimply by holding your phone near suitableterminals.
  • 5. Paytag> PayTag which has recently been launched byBarclaycard, is probably the most widely usedsystem using NFC technology in the UK just now.> A PayTag is basically a sticker that’s fitted ontothe back of a mobile phone, which uses NFC totransmit information from Barclaycard creditcard accounts to contactless payment terminals.
  • 6. What are the benefits?> Well, for one it’s a lot quicker and easier thanfiddling about with cash or even a card – thetransaction is literally over in seconds.> Secondly, you don’t need to fiddle about witha PIN, or find yourself in a position where you’restuck because you’ve forgotten about it.
  • 7. But is that safe?> Yes, it’s as safe as any other form of payment,and you’ve got the same 100% level of fraudprotection as you’d get on any other card.> If you lose your mobile, you just have to treatit like you would losing your wallet or your creditcard – phone up and report it as missing as soonas possible.
  • 8. So where can I use it?> In more places than you think – huge HighStreet names like Boots, WH Smith and Tescoare using the service, and fast food outlets likeMcDonalds, Subway and Pret are also embracingit.> In fact, by the end of the coming year therewill be 150,000 contactless terminals across thecountry – you’ll even be able to use it on theLondon Underground.
  • 9. Will NFC take over fromtraditional payments?> Some people are certainly hoping so – it ispretty convenient after all.> The future is obviously unwritten, but previousresearch has indicated that £3 billion worth ofpurchases will be make through mobiles by 2016in Britain alone. Pretty exciting stuff!
  • 10. Image: Vernieman