NFC in payments space! What is it all about?

MEDICIFounder and Chief Strategy & Innovation Officer

Not so long ago, I remember queuing up to grab a movie ticket at a movie hall which could stretch my waiting time from a few minutes to an hour or more. Wouldn’t it be nice to cut down the waiting time by cutting down the additional steps of taking out your wallet, sift through those dollar bills, hand out cash at the counter, grab a ticket, accept change and get out of the queue. Is it possible? Yes it is.

NFC is in its most common avatar is a Tap & Pay solution that can be used for retail offline payments, transit, entertainment and numerous other touch points. Any unattended payment situation such as a parking lot presents huge opportunity. For e.g., clipper card or any cashless cards being used today for public transport can be integrated into the ubiquitous phones itself thereby making the public transport payments easier.

Most of the mobile phone manufacturers see the benefit of introducing NFC on their mobile phones. Current versions of smartphones have NFC integrated in them (except Apple). One of the advantages of having an NFC system in your smartphone is the ability of the phone to securely transfer and receive data from any other NFC enabled terminal/device when placed within a specific range.

Some of the major corporations active in this area are Google through its Google Wallet service, ISIS and iKaaz in India. Elsewhere in the NFC world, Telefonica of Czech Republic is all set to launch a set of trails of mobile point-of-sale (mPOS) devices aiming at Small and Medium Businesses. The new devices will be capable of accepting payments credit cards, contactless cards and also NFC enabled smartphones.

LTP View: NFC had a rather slow uptake than expected.

  • Many analyst revised the forecasts for NFC (Read). One of the big blows was Apple dropping NFC in its iphone 5 phones.
  • Short NFC range will hinder contactless payments
  • Security concerns of data manipulation and interception attacks. NFC based payment systems are not yet full proof. There are some security issues which need to be fixed. Intruders are able to access sensitive data on an NFC enable phone through “Eavesdropping,” by tapping in to NFC signals using advanced electronic circuits. Many of the security risks can be mitigated through enabling Identity Access Management policies restricting the data access to only authorized users and alerting the user during a security breach.

Amit Goel

MEDICIFounder and Chief Strategy & Innovation Officer

Amit Goel is the Founder & Chief Strategy & Innovation Officer for MEDICI. Amit’s vision is to build a strong FinTech market network that involves financial institutions, banks, startups, investors, analysts & other key stakeholders across the ecosystem – helping each one of them in a meaningful way by removing the asymmetry of information and providing a platform to engage & transact.

Amit is passionate about bringing actionable FinTech-focused insights, innovative products & services for the FinTech ecosystem. Some of his work involves startup scores, bank scores/assessments, predictive viewpoints & other innovations that have helped MEDICI’s customers and the ecosystem. He has been named amongst the Top 100 FinTech thought leaders/influencers in the world & Top 10 in Asia multiple times by reputed agencies, consulting firms as well as financial institutions. Amit has built MEDICI (formerly LTP) as a new-age, tech-enabled advisory/research firm, which is now considered the #1 global research & innovation platform for FinTech in the world.

Amit has been writing pioneering viewpoints on financial technology space that have been ahead of the curve since 2010. His data-driven predictions have helped the customers as well as the ecosystem. His past work experience includes a strong background in strategy & market analysis and advisory to clients (from big business houses to Fortune 500 firms) in payments, commerce, financial services & IT/technology. In the past, Amit had also founded a successful consulting & research practice called GrowthPraxis and has worked at Boston Analytics, Frost & Sullivan, and Daimler Chrysler in strategy & research.