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Cartes 2008 focuses on contactless

Attending Cartes this year, it is clear that contactless is the ‘next big thing' in payment innovation. Talked about for years, it is finally on the brink of mainstream adoption. In Europe, the UK and France are trailblazing the way with contactless trials completed and aggressive roll-outs underway. Barclays in the UK has recently expanded its range of 'wave and pay' cards and hopes to convince more retailers to accept contactless payments as it seeks to beat its target of getting one million contactless cards out to customers by the end of the year. In France, MasterCard Worldwide and RATP, the major transit operator in Paris, have just announced that they are looking at using MasterCard PayPass to access public transport services in the French capital.

Talk here at the conference is however focused on how to make mobile phones NFC-enabled through all sorts of gadgets from adapted SIM cards with antennas to stickers. Innovators are desperately trying to get into the NFC market before the phone companies who are perhaps still 3-4 years down the track. Yet, as with cards, contactless mobile payments raise a number of issues including merchant service charges for retailers, points of interaction for customers and security risks. However, the biggest stumbling block in ensuring the long-term success of NFC technology is building and maintaining cross-industry relationships. Finding a viable commercial model that fits all parties' requirements and is affordable for consumers has to become the priority if contactless payments via NFC-enabled mobile phones are to become a reality.


Comments: (1)

A Finextra member
A Finextra member 06 November, 2008, 23:14Be the first to give this comment the thumbs up 0 likes

I'm not particularly inspired by the target of 1 million NFC cards in customer's hands by the end of the year. How many card-holders are there in Europe? It's clear that startups have higher goals set for them than existing players are expected to achieve. I was thinking 1 million new customers using NFC in a week would be more the sort of target you would have to aim for.

It's caused us to revise our numbers.

A simple calculation of 3.3 billion mobile users at 1 million per week converting to NFC gives a time frame of 63 years for roll-out, just to the people who already have phones. I guess that will give the great-grand-children something to do.

Remember the current target of 1 million by Christmas would stretch that out for a couple of centuries. A never ending story.

I promise my great-great-grand-children won't say 'I told you so'.

For a little sobering thought - we were thinking in the range of a million per day (per market), especially as TV advertising is going to get awfully cheap soon, and a smart mobile operator would likely have a plot which involves plenty of that cheap TV. Even at that rate, mobile transactions are likely to quickly overtake NFC, RFID, Smart Card, or whatever other names it aquires in the next round of spin.

There's no reason why mobile transactions couldn't be rolled out at 20 million customers per day if the global brands catch on to what is at stake (and they are) so I still don't see a very bright future for NFC.

Did anyone run any numbers past the shareholders on that one by the way? Surely. In another Finextra blog I saw someone mention 15 euro for a card, well we know thats fantasy and I'll assume 5 euro to get it in a customer's hand. Who is forking out that 16 billion or so just to provide cards?

Am I the only one who actually looks at the numbers?

Looking at the market - probably.

Best of luck there.