Paying for goods using mobile phones: Waving goodbye to plastic

While mobile phones were originally conceived as devices purely aimed at allowing portable communication between the business elite, they have become throughout the world and have accrued a number of additional functions on top of basic talking and texting.

While cameraphones allowed users to capture life comprehensively and smartphones opened up a wealth of apps and web-based services, the latest technology to arrive on the scene is NFC (Near Field Communication).

It may not sound that glamorous, but NFC is being touted as the thing, which will make paying for goods using mobile phones a common occurrence, with the potential to remove the need for credit and debit cards as a means of portable payment.

NFC technology essentially allows for contactless payment to be made by a consumer with a compatible mobile containing an appropriate chip linked to their account. A number of retailers will begin offering NFC consoles at the checkout so that users can simply swipe their mobiles close to the surface and pay for whatever product or service they choose. There will be no rifling through wallets looking for cards or counting out change, because the process will involve your mobile phone, which most people keep with them at all times.

There are a few caveats to the use of NFC technology in the short term, largely introduced to ensure that it is used securely. The first is that payments are limited to a maximum of around £15, which will allow consumers to buy groceries, pick up their lunch or grab a bus ticket but will not let them pay for more expensive items. This should reduce the desire to impulse buy and will also make it more difficult for fraudsters to exploit NFC. The second is the use of PIN codes when paying by NFC, which will mean there are some similarities between it and payment cards. However, this will mean that it will not be possible for just anyone to buy goods using your mobile, making the loss or theft of a device less troublesome.

At the moment the Google Nexus S is one of only a handful of mobile phones which has NFC built into it, but more are planned for the future and Apple is thought to be considering the integration of the technology for the fifth iPhone handset. The good news is that you will not necessarily have to invest in a range-topping smartphone to get NFC in your pocket, because network providers like Vodafone and Everything Everywhere are working to introduce NFC into the SIM cards found in all phones. This will allow you to swap your NFC chip between multiple handsets, not tying you to a single phone.

What is required now is for the wireless sender technology required for NFC to become a widespread feature in high street shops and outlets across the country just as NFC technology is packed into mobile phones, allowing it to reach a critical mass and break onto the mainstream. Then consumers will really be able to cut up their payment cards and consign them to the history books.

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