I have just attended the Cartes Exposition in Paris. Cartes is reportedly the largest exposition dealing in the subjects of cards, ID and mobile payment. This year’s exposition was certainly influenced by the resurgence of interest in the topic of mobile contactless payment. NFC and TSM was the topic on every body’s lips. Conference topics on this subject were so well attended that it was almost impossible to get into the meeting rooms where speakers spoke of their experiences and ambitions.
Transit is key to NFC
Transport for London (TfL) has recently announced that it will accept NFC transactions across its network by July 2012. Why might this be a game changer? Well the use of a mobile phone as the contactless payment token for transit re-enforces the move to open loop – EMV payment for transit applications. To me this strongly confirms a contention which I have argued with my colleagues, that in the future Visa, MasterCard, Discover and Amex will become the issuers of preference for transit ticketing and payment tokens.
Secondly TfL’s Oyster card and Hong Kong’s Octopus card has driven a societal behavior in the communities they serve for “tap and go” as a means to effect payment and/or access. And with the London Olympics in 2012, this will surely play well to increase the experience of NFC in transit. Where leaders go the rest often follow.
What about the card form factor?
But will all of this really reduce our reliance on the card as a token that enables payment? We at ABnote don’t think this will be the case, and you might be likely to say “well of course you would say that – you make dual interface cards don’t you!” The last point is clearly true, but that is not the reason for our collective contention that the physical card and contactless mobile payment are complementary technologies.
Our reasoning is quite simple – the card is a universal device that is accepted in most countries of the world, from advanced economies to the emerging economies alike. While globally there are 5.2 billion mobile subscribers, with 450 million of these using a Smartphone, the ecosystem required to issue and accept NFC payments is significantly more complex than that of the physical card. At the most basic level the card requires no power to effect a transaction; it can be used in a mechanical embossing machine through to a sophisticated tap and go point of sale device.
It’s all about issuance
However we cannot ignore the significance of NFC and the implications that may arise from it. ABnote’s presence at Cartes illustrated this; our focus this year was centered on customer driven solutions, based on a central theme of secure issuance. We recognize that we must be able to securely personalize tokens whether this is physically in our secure manufacturing facilities, or held as a secure element in an NFC enabled Smartphone.
ABnote is the Gold sponsor of Cartes North America in Las Vegas in March 2012, where we will be again demonstrating our solutions focus with specific emphasis on those applying to EMV, NFC and ID.