Putting NFC to the test

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Reporter Samantha Tomaszczyk heads to the ‘homeland’ of contactless near field communication (NFC) payments, the Slovakian capital of Bratislava, to check out the technology

Back in 2008, O2 asked a representative sample of its customer base whether they would consider paying for items with their mobile phone using near field communication (NFC) technology.

Of the 500 people that took part in the survey and subsequent trial, 90 per cent claimed the experience was a good one, with 78 per cent stating they would be interested in using the service in their everyday lives.

At the time, O2 sent out a press release stating “UK consumers want NFC on their mobiles”. It claimed the results of its trial took NFC one step closer to mass deployment.

Five years later, progress remains slow – in the UK at least. However, just a short hop from the UK, in the Slovakian capital of Bratislava, the story is very different.

According to Visa head of mobile Sandra Alzetta: “Slovakia has really tapped into the market, making NFC a reality.”

She claims more than one million contactless transactions take place now each month in Slovakia and 60 per cent of all Visa debit and credit cards there are now contactless.

More than a third (36 per cent) of all terminals accept NFC payments and 10 per cent of all Visa transactions are contactless.

The payments provider, which has been heavily involved in NFC deployment on mobile devices, predicts the number of contactless transactions in the UK will quadruple in 2013 from 2.5 million per month in 2012 to 10 million per month by the end of the year, driven by major retailers such as Boots rolling out terminals.

NFC-ready handsets are also proliferating, with Visa recently agreeing a deal with Samsung to include its payWave app on new models. The manufacturer expected more than 100 million Samsung devices to be shipped this year with the functionality.

O2 Wallet
In Slovakia, as in the UK, Visa Europe has partnered with O2 to create an NFC version of the ‘O2 Wallet’ app.

O2 had originally intended to launch an NFC version of the app in the UK by the end of last year but overshot the deadline.

The NFC version launched in Slovakia in January, aided by Visa’s partnerships with a number of Slovakian banks to accept the form of payment. One of those is Tatra banka, which is the only bank not to impose an NFC transaction limit – most banks do not allow transactions above €20.

To test the payments system for ourselves, Visa sent us to one of Bratislava’s largest shopping centres, Eurovea, which contains more than 30 outlets that accept NFC payments.

Armed with an NFC-enabled Samsung Galaxy S III handset with O2 Wallet installed and €60 of credit to spend, I set off to see just how good – or how bad – the concept of wirelessly paying for goods with a handset is and, importantly, whether or not it will one day convince me to leave my debit and credit cards at home.

Marks & Spencer
I headed first to British retailer Marks & Spencer’s outlet in Eurovea.

Marks & Spencer has heavily embraced NFC technology, becoming one of the first major brands to install contactless terminals in its UK stores.

Indeed, in Slovakia, Marks & Spencer was one of a handful of shops in Eurovea to have Tatra banka terminals, which I found out the hard way later on in the trial meant it could accept payments of unlimited value.

Starting off slowly, I limited myself to just two bags of ‘Percy Pig’ sweets and made my way to the checkout, Samsung Galaxy S III in hand.

Having tested the service back at the hotel, I had no fears as I approached the till.

On seeing my handset – which I made no attempt to disguise – the cashier knew immediately by what method I wished to pay. It was a far cry from an earlier trial, featured in Mobile News, of Visa’s payWave app during the London Olympics (see issue 523).

I was asked to place my device on the wireless terminal which also handles card payments. I held it there in anticipation.

The settings on the app meant I didn’t even need to unlock the phone or input my PIN for transactions of less than €20.

It was a much more convenient way of paying for small items than with a non-contactless credit or debit card – and the cashier was clearly familiar with the process, which was reassuring.

After a couple of seconds, the words ‘Payment Approved’ appeared and with the pigs bagged up, I left the store. A great start.

Full article in Mobile News issue 544 (July 29, 2013).

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