Has Vul­ner­a­ble the Net­works Time Fi­nally Ar­rived?

NFC holds great prom­ise as an en­abler of mo­bile pay­ments but the In­dian mar­ket is yet to cash on its po­ten­tial

Voice&Data - - NEAR FIELD COMMUNICAT­ION - Akanksha Singh

Near Field Com­mu­ni­ca­tion (NFC) for mo­bile pay­ments has been mak­ing a buzz around the In­dian mar­ket for some time but these buzzes have been just buzzes. No doubt, NFC holds a great prom­ise as an en­abler of mo­bile pay­ments and has been suc­cess­fully de­ployed around the world; the In­dian mar­ket has been fool­ing around with this tech­nol­ogy. For tech­nolo­gies like NFC and DASH 7 to suc­cess­fully gain strong foothold in the In­dian mar­ket, there are still other blocks to be placed right for this puz­zle to get its fi­nal shape.

Con­sid­er­ing the In­dian sce­nario, the de­mand and the need stand at the bot­tom of the pyra­mid where m-bank­ing (bank­ing the un­banked with the help of mo­bile) still needs to at­tain its full bloom; so NFC tech­nol­ogy, which is con­sid­ered a tech­nol­ogy for elites (ur­ban pop­u­la­tion which is quite low as com­pared to ru­ral pop­u­la­tion in In­dia), is many lev­els up this pyra­mid.

In­spite of say­ing this, NFC mo­bile pay­ments still hold im­mense op­por­tu­nity for their growth in the In­dian mar­ket when it comes to con­tact­less pay­ments in the ur­ban In­dia. Although NFC is a rel­a­tively new tech­nol­ogy, its adop­tion will sky rocket over the next few years.

There is ab­so­lutely no doubt that tri­als and ef­forts are be­ing taken in bits and pieces. Many hand­set ven­dors and mo­bile pay­ment plat­form mak­ers are ty­ing up for this tech­nol­ogy to make this a re­al­ity. Sam­sung Elec­tron­ics has an­nounced a NFC chip, Broad­com has un­veiled a new fam­ily of NFC chips, Nokia has launched NFC en­abled hand­sets in as­so­ci­a­tion with Pay­mate, HID Global in as­so­ci­a­tion with Sony has jointly de­vel­oped con­tact­less smart card reader plat­form, DMRC also has been in talks with NXP to ex­plore how NFC can be de­ployed for tick­et­ing through mo­bile in Delhi Metro.

RBI, to en­cour­age con­tact­less pay­ments in In­dia, re­cently ap­proved daily trans­ac­tion limit of ` 50,000. The GSMA has an­nounced that 45 of the world’s lead­ing mo­bile op­er­a­tors in­clud­ing Bharti air­tel and Voda­fone have com­mit­ted to sup­port and im­ple­ment SIM based NFC so­lu­tions and ser­vices. In ad­di­tion to the 2 op­er­a­tors, the list in­cludes lead­ing op­er­a­tors of the world like China Mo­bile, China Uni­com, Ax­i­ata, Soft Bank Mo­bile, etc.

An ef­fec­tive pi­lot project named Citi Tap and Pay was started in Ben­galuru some time ago. It al­lowed con­sumers, who were hold­ers of Nokia 6212 hand­set (with em­bed­ded NFC chip) with a Voda­fone con­nec­tion, to make pay­ments at se­lect re­tail out­lets by just tap­ping their phones at the pre-in­stalled pay­ment ma­chines. NFC tech­nol­ogy firm Viv­otech Inc supplied con­tact­less ter­mi­nals and over-the-air trans­ac­tion soft­ware.

NFC is def­i­nitely mak­ing in­roads into the In­dian mar­ket but slowly and gradu- ally. Be­fore one comes to any con­clu­sion whether this tech­nol­ogy is next sought af­ter for the In­dian con­sumers, he will be jump­ing the gun. There are many unan­swered ques­tions for the in­dus­try to solve such as how will the new tech­nol­ogy be adopted by con­sumers who are al­ready clut­tered with a plethora of tech­no­log­i­cal in­no­va­tions, does NFC have a fu­ture as a sus­tain­able busi­ness ven­ture, have com­pa­nies al­ready started de­vel­op­ing the re­quired in­fra­struc­ture for these de­vices, what is the state of in­fra­struc­ture readi­ness in emerg­ing economies, etc.

The in­ter­op­er­abil­ity is very crit­i­cal to the wide­spread adop­tion of NFC, en­abling users to ben­e­fit from NFC ser­vices around the world re­gard­less of op­er­a­tor net­work or de­vice type.

A trend that is be­ing fol­lowed around the world is the op­er­a­tor com­mu­nity is fo­cused on driv­ing the stan­dard­ized de­ploy­ment of mo­bile NFC us­ing the SIM as the se­cure el­e­ment to pro­vide au­then­ti­ca­tion, se­cu­rity, and porta­bil­ity.

The re­quired in­fra­struc­ture for this tech­nol­ogy to be fea­si­bly de­ployed in In­dia is still a chal­lenge. The RFID chips are yet to be de­ployed by the chipset mak­ers on a mass scale.

NFC en­abled hand­set ven­dors and mo­bile pay­ment plat­forms need to col­lab­o­rate and cre­ate NFC plat­forms more ag­gres­sively.


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