NFC success will be driven by non-payment features

While many experts generally agree that near-field communications technology used to enable credit card purchases with smartphones will be adopted on a large scale in the near future, they also say that it will be secondary features that entice new users.

Within the next few years, it's expected that millions of consumers across the country will be using NFC-enabled smartphones to make credit card purchases instead of swiping their plastic the traditional way, but initial adoption is largely considered to be a significant hurdle, according to a report from the Smart Card Alliance and its new Mobile and NFC Council. Instead, it will be the features that come along with these mobile wallet programs that will entice consumers to adopt the payment method for the first time.

"[NFC technology is] about the integration of finance, retail, health, government," Doug Morgan, the chief strategy officer at the mobile transactions company C-SAM told attendees at a recent Mobile and NFC Council meeting.

In short, the more flexibility users have with their mobile wallet programs, such as the ability to link their phones with store loyalty rewards plans, social couponing accounts, and so forth, the more likely they are to both adopt the programs out of curiosity, and then stick with them, the report said. Already, the Isis mobile wallet program pioneered by AT&T, T-Mobile and Verizon Wireless has partnered with hundreds of local and national merchants to allow use of these systems and, likely, the ability for users to find unique offers and deals through those partnerships.

The governmental application may be a significant one as well, as officials from the provincial government of British Columbia, Canada, say they see NFC capabilities as a way for them to increase the security, privacy and ease of use for residents who receive public healthcare, the report said. The same could be applied to expedite driver's license renewals and other such processes.

Consumer adoption is always a concern when new technologies come along, but in the end, the most useful ones end up surviving. A recent example of this is in mobile banking, over which many consumers expressed worries, especially with regard to account security. Ultimately, however, many began to see the value of these systems and now use them regularly.

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