Is Near Field Communication Your New Wallet?
The buzz on Near Field Communication (NFC) has been around for quite some time. Many companies and organizations from the Semiconductor, Banking, and Mobile Phone industries have been experimenting with the technology through numerous pilot projects over the years. Various issues such as inadequate infrastructure and lack of cooperation among merchants have been deterrents to the penetration of NFC. These deterrents still exist today, however, companies in the NFC value chain believe that it is only a matter of time before the technology is fully accepted and becomes as prevalent as the mobile phone is today.
NFC technology provides a whole array of benefits to not just the vendors in the NFC value chain, but to the consumers as well. The ability to be able to have all the functionalities of a credit, debit, access and loyalty card on a single device i.e., the mobile phone is a highly attractive proposition that is welcomed by all. The only problem is that certain issues such as the lack of awareness about NFC and the current low proliferation of the technology (in addition to the issues mentioned above) have not allowed NFC to be widely accepted. Inspite of this, it is believed that NFC will make an impact on the Payment market and this could take place within the next five years. Companies such as Nokia Corp., Research in Motion Ltd., NXP Semiconductors N.V and Inside Secure S.A have all been instrumental in promoting the use of NFC.
What is even more encouraging is the fact that Google Inc. had experimented with NFC for its ''mobile wallet'' program. The company had encountered a number of problems especially in bringing merchants on board in its plan. This, however, has not dissuaded Google as the company still believes that NFC will be the next stage in payments.
In short, NFC technology has not yet reached the masses because of a number of operational issues, however, investments in the technology continue to grow and so does the number of vendors involved in the NFC value chain. The number of pilot projects that are testing NFC continue to increase and there is a slow yet steady number of mobile phone manufacturers that have started providing NFC capabilities on certain mobile phone models. All of this leads one to believe that it's only a matter of time before NFC becomes your new wallet.
Please see Technavio latest report on NFC, Global Near Field Communication Chip Market 2011-2015.