Choices at the Checkout- Why is NFC Slow to Ignite?

Contactless isn’t the only payments innovation that has been slow to ignite. The community has been debating the following “Ask the Industry” question:


What is the most significant contributor to the slow growth of mobile NFC?


“Before you need killer apps, you need the POS terminals to have a reader available to swipe the NFC phones against. If you don’t have concession on this “FROM ALL MANUFACTURERS,” then what is the point of having the phone? (We’re talking the agreement on the type of NFC technology at first.)

Also, think about reconciliation as well. Now, you have the manufacturers with the readers, and yet the software vendors (on that POS) are not cognizant of what was “just read.” So now you’re placing this purchased product under a miscellaneous category. This doesn’t do much good for determining usage via reports. Can be done but it’s time consuming by that food store… and frankly “what’s in it for them?”

And think of the communication effort “or back end processing” of the transaction. You need to somehow pass this swiped data intelligently to trigger some form of financial transaction AND integrate the wonderful features of the phone that just did the swipe.” – Al Butler




“I don’t think there is one single reason here. The EPC has laid out the five scenarios, thing is, they are obvious but fiendishly difficult to implement, and no one is willing to stump up the investment as it requires investment from three of the four parties AND OEMs AND MNOs (great!). The channel is a complete unknown, and business cases are hard to build on the back of consumer opinion.” – Michael Thomas




“It’s not so easy to increase mobile users while there are a large amount of card users. Once people feel it’s convenient to use the smartcard for payment or transit, they will not dare to replace the card with a smartphone.


As for the merchant terminal cost problem, future smartphones supporting NFC R/W mode might become a trigger to break the wall. In a future scenario, a user will tap his/her NFC phone (as default, card emulation mode) on the merchant’s smartphone running as R/W mode. This is just my private opinion of future scenario. :-) ” – Naohisa Ichihara




“Reason for slow growth of NFC, at least in the U.S., is 1) lack of compelling need given the existing and numerous payment methods consumers already have, and 2) distribution. Consumers don’t want another card, so best option is integration into the phone and that solves the distribution problem. Both Google & Apple are planning for 2011.” – Charles Herel




“The lesson for those who would drive change today is that it’s a lengthy job. The ultimate solution may barely resemble the initial perception, and the impetus needs to come from one or both of the global card payments organizations, which already has the organization in place to effect change when the motivation is realized.” – Scott Harrison




“The real driver of NFC adoption will be applications outside of banking.” – Andrew Rowe



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