NFC (Near Field Communication) is a wireless data transmission technology. Its main feature and difference from Wi-Fi or Bluetooth is that with weak signal strength, it provides an instant connection and fast transfer of information. NFC-chip devices exchange information at a short distance – up to 5 centimeters.
Technology is used in different ways. For example, some restaurants use NFC tags to send passwords and Wi-Fi network settings to visitors’ smartphones. But its most mass application is a contactless payment via mobile gadgets. As a rule, those are smartphones with NFC chips, but it can also be watches, bracelets, or rings.
It works like this. A customer brings a gadget to a payment terminal equipped with an NFC chip. It transmits the bank card’s encrypted data, followed by a successful payment.
Why are NFC payments so popular?
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It Is Convenient
Before NFC, to pay with a card, one had to take it out of the wallet, run it through a terminal and wait for the terminal to read the data from the magnetic strip or the chip. This took quite a bit of time, sometimes up to a minute, and customers had to wait outside the cash register. Besides, you had to control that the card was always with you.
With the advent of contactless payment, everything has changed. At first, there were cards with NFC chips which you still had to carry with you, but you didn’t have to put them in a terminal. You could just hold it near the terminal. Bank customers liked it. But the main breakthrough in POS software development services came with the emergence of mobile payment systems Apple Pay and Google Pay, which allow you to forget about a wallet and pay in stores, cafes, and transport, having only a smartphone.
In other words, carrying a credit card, let alone cash, is no longer necessary. All payment data is stored on the mobile device in the electronic wallet. The electronic copy of the card has all the same properties as the plastic original: it will earn cashback, accrue miles, interest on the balance, etc. when paying.
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It Is Secure
Even safer than paying with a regular plastic card. Mobile payment systems have a multi-level security system.
First, a card number added to the electronic wallet is not stored at POS terminals or on the servers of payment systems. Instead, a unique account number is assigned to the device, which is encrypted and stored locally – a token. It is used for payments instead of card data. When paying with the phone, the customer doesn’t give the merchant his credit card number or personal information.
Secondly, one-time security codes are generated for each payment transaction.
Thirdly, NFC payments will work only with gadgets protected by password or biometric identification technologies. To pay, the customer must identify himself by entering a code or scanning a fingerprint or face. It means that even if some criminal steals your phone, he won’t be able to spend money from your credit card.
All of this protects your money better than a card with a magnetic stripe or even a chip.
Payment Systems
There are quite a few payment systems in the world, but we will talk about the most famous and popular.
Apple Pay
The payment system was presented to the public at the WWDC 2014 conference. Then the owners of iPhones starting from the 6th model and newer were able to pay with their smartphones and smart watches from Apple in stores, restaurants, and transport. First in the U.S., then in other countries.
Google Pay
Google’s payment service for Android devices appeared in 2015. At first, it was called Android Pay. Then the service was renamed Google Pay.
The service works on smartphones with Android operating system version 4.4 and above. You can download the application Android Pay in Google Play Market.
Garmin Pay
Garmin Pay is a payment system that allows you to pay with Garmin smartwatches. The service was presented in late 2017 with the announcement of the Vivoactive 3 smartwatch.
To connect to Garmin Pay, you need a watch that supports this technology, a partner bank card, and a smartphone with the Garmin Connect app installed. The watch must be added to the program and paired with your phone via Bluetooth.
Mi Pay
The system was created with the Xiaomi Mi Band fitness bracelet, the undisputed sales leader in the world. In their reviews, its numerous fans often wrote that the bracelet is suitable for everything, but it lacks a payment function. Xiaomi has heard the fans, creating the Mi Band and releasing Mi Smart Band 4 NFC – a bracelet version that supports contactless payment.
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