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By 6 December 2011 | Categories: news

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If Absa has its way, the days of a carrying around and potentially losing a conventional wallet may be numbered. Today the bank launched the country’s first live user trial of Near Field Communication (NFC) technology on mobile phones.

The trial, which will begin from the middle of this month with 500 of the bank’s personnel, is intended to pave the way for the general public to be able to use their mobile phones to make payments of small amounts in both retail stores and on different modes of transportation, such as taxis and busses.

Paying with your phone

The company explained that along with Mastercard, it has embedded its Paypass Tap and Go payment card on BlackBerry handsets for the trial.  This will allow trial participants to load funds into a secure section of the phone using an Absa ATM, Absa’s online banking site or at point of sale, and pay for goods at coffee shops, canteens, and later, at other service providers that are located at Absa’s head office in central Johannesburg using the technology.

While details are a bit sketchy at the moment, NFC technology will apparently be loaded onto the phone through the use of a microSD card. However, at an as yet unspecified point in time, this would later be enabled via one’s SIM card.

Adrian Vermooten, deputy managing executive of Absa Digital Banking, explained that all the payment and NFC services that are available on the handset will be accessed from the mobile phone’s main menu, in addition to information about each service, and customer support.

“By simply tapping one’s phone in front of a contactless NFC-enabled pay point, the value of the transaction will instantly be debited from one’s bank account,” he elaborated.

The ramifications and positive effects of using NFC could be quite numerous, such as enabling faster transactions, shorter queues, increased levels of security and the ability to electronically track one’s spending habits.

Tap to transport
 
Additionally, the bank stressed that it was concentrating quite heavily on transportation, such as taxis and Rea Vaya busses, for the use of the technology. Simon Just, the head of consumer issuing services at Absa Card, added that Absa was aiming to make banking more accessible to everyday South Africans, who relied heavily on public transport. He continued that transit was being viewed as a springboard for the proliferation of the technology.

To this end, he explained that the bank’s mobile payment system also contained the National Department of Transport data structure which will, in future, facilitate more advanced payments in transit.  The application on the phone will store details of the commuter, the day and time, where they entered and exited the transit system - and use this information to calculate the fares.

A small step leading to a significant change

The NFC trial follows Absa’s launch of its "tap-and-go" technology which enables users to make payments by tapping their bank card on a reader.  The NFC trial uses the same readers to accept payments from smartphone devices that are enabled with the NFC technology.
 
Vermooten pointed out that both technologies are aimed at exploring new ways to add convenience and value to payments, by using NFC technology to “breathe new life” into ‘tap, pay and be on your way’ payment capabilities.
 
He further stressed that the trial is just the beginning, and intended to provide “key insights which will prove crucial to refining the customer experience” as NFC on mobile is brought to market.

The bank’s vision is that in the near future, users will be able to store any type of payment card in their mobile wallet on their smartphone, and either pay online by tapping the phone on a merchant’s reader or on a person-to-person basis. “This new technology is paving the way and building acceptance networks for mobile payments in future,” he added.

To the point

In many ways the launch was a quiet one, of a seemingly small technological step. However, if it delivers all Absa predicted it could, it may well mark the beginning of the end for the leather wallet. Vermooten pointed out that it is believed that it take an average of 28 hours to realise that one has lost one’s bank card, but only 6 minutes to realise that one has misplaced one’s cellphone.

Beyond the very real benefit of never having to experience the panic of having lost a credit or debit card again, the launch of NFC payments may also make a significant and large difference over time, not only to how we make payments, but also how we store and think of that most essential accessory, our wallet.  

In recent news, Absa announced a series of innovations that sees the ATM (automated teller machine) evolve from simply being a cash dispenser to a comprehensive digital banking tool.

  

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