Citi exec sounds NFC battle cry, others claim it's a whimper
If it lives up to the hype, near-field communication (NFC) could be a boon to the financial services industry, which could benefit immensely from mobile payments adoption. Richard Char, the global head of digital networks and merchant services at Citi, told attendees at a recent conference that a coming shift in card technology will pave the way for NFC adoption.
"Chip and pin" technology, advocated by Europay, Mastercard and Visa, relies on a chip embedded in cards rather than a magnetic strip; and within two years, 95 percent of cards in the United States are expected to use chip and pin, reports Street Fight Magazine.
By the end of 2014, retailers will face "a Y2K moment" requiring them to update their card-reading infrastructure, said Char at the Mobile Marketer conference held last week in New York City. And because the signal transmitted from the card to the terminal is nearly identical to the one used for NFC, it will soon be irrelevant whether the payment is coming from a phone or a card, he said.
Char also reportedly told attendees that the newest version of the Android incorporates an NFC-friendly change--a protocol called host card emulation that allows an application to store the financial data on the device and bypass the carrier.
Android is currently the only mobile operating system that supports NFC. Some mobile industry experts say NFC's deep support from Android won't do much good because other platforms have yet to show interest, reports The Motley Fool.
"Honestly, I think the only hope [for NFC] is Tim Cook coming out on stage and debuting the iPhone 6 with NFC. And even then, I'm not sure that it's a gamechanger," said Brandon Workman, a researcher with Business Insider Intelligence, in a recent interview with The Motley Fool.