I see that credit card companies have started deploying Near Field Communications (NFC) technology to the world (aka Contactless Payments), and speculation is running on which mobile handset vendors will bundle the technology. Am I the only person who thinks that it’s a neat solution to a problem that doesn’t exist – outside of the few geeks and Credit Card Issuers who think it’s neat?
I think Square (the mobile phone credit card payment processor and designer of the iPad till shown above) have got it completely right, where NFC takes everyone up a blind alley. Square started by looking at the usual buying experience in a retail setting, and worked things back from there on how to remove all the friction. It sort of works like this.
When a regular customer is within a short distance from the shop, their picture and name appears on the till. If they walk in, one press shows their regular order items and any special upsells. They can be greeted by name, asked if they want their usual and whether they’d like to try the offer of the day. You can then offer to let them pay using their normal debit or credit card, process the payment and email the receipt. You have already authenticated them, so all good to go. A nice retail experience.
With NFC, all the action is past the time when you can do the basics of good service, and the upsell opportunity is gone. You just take the payment, and oops – they need to authenticate that they are the user of the phone (otherwise a thief with a stolen phone would run past every till in the nearest department store). So you have to enter a password or pin. So, what’s the extra advantage over using a card, without the retailer having to cough up the costs of expen$ive readers?