Until recently, NFC (“near field communication”) had some fringe applications, and Google Wallet hadn’t really been widely understood or adopted. That’s all about to change with the headline-making ApplePay— but do you understand how NFC works? And are you ready to leave your wallet at home and pay with your watch or smartphone?
Let’s break it down: NFC is a radio frequency system that allows information to be transmitted short distances between devices, and it works via a chip inside your phone and an antenna embedded in your phone’s battery. It demands very little battery power, and it’s transmission range is short— it needs to be within centimeters of the device it’s connecting to. Even though it’s going to take time for people to trust it with their credit cards, it’s a lot more secure than plastic— you need a fingerprint or a passcode to activate a payment, and then the chip inside your phone OKs the transaction.
Now, if you’re protesting that you’ve known about Google Wallet for some time, I hear you. Google has had it since 2012, accepted at 300,000 stores. But a lot of those were convenience stores that weren’t plentiful outside major cities, and the number of actual handsets that supported NFC was limited. And, truthfully, retailers were wary of Google and how it would handle all the private transactions of their customers. The iPhone 6—the first iPhone with NFC—is a game-changer because it promises to bring in a huge number of Apple users, and because Apple has forged alliances with a wider range of bigger chain stores.
Of course, none of this can happen before enough handsets support it, and retailers install the payment system. Target, Macy’s, Walgreens are starting to introduce NFC pay terminals, but a big change is coming next year, when Mastercard and Visa change all their pay terminals to EMV, the European system that reads a chip on your credit card. That new infrastructure is expected to support NFC. Then, you’ll really be able to leave your wallet at home.
It goes without saying that, if you lose your phone, you’ll be able to wipe it clean or turn it into a brick before anyone can have a shopping spree with your NFC credit cards. Just as a good measure though, you should always have a passcode on your phone to make it that much harder to get in if you happen to leave it behind.
Have you used NFC already? Let me know in the comments!