As part of its announcements at this week’s Mobile World Congress in Barcelona, Deutsche Telekom has revealed it intends to step aggressively into payment transactions based on near-field communications (NFC) technology, with plans to introduce NFC-based “mobile wallet” technology in Germany and Poland this year, with roll-outs expected to extend to the Czech Republic, the Netherlands, and the United States—via T-Mobile USA—during 2012.
The mobile wallet technology will enable consumers to conduct transactions simply by positioning their mobile phones in proximity to an NFC device to conduct a purchase: the cost of the purchase would simple appear as part of the users’ mobile bill. NFC transactions are being hailed as a way eliminate having to carry change around to pay for things like parking and vending machines, along with the hassle of having to deal with magnetic strips on payment cards—although the technology does require that users’ phones be enabled and have working batteries. (Something smartphone addicts are sure to do anyway.) Deutsche Telekom says they will ensure the security of NFC transactions using “international security standards” from the SIM card all the way through the wireless NFC technology; the mobile wallet will also enable users to lock or disable applications in the event a phone is lost or stolen.
Deutsche Telekom is also looking at the service’s marketing angles, noting that individual retailers will be able to offer “bonus systems” for use with the mobile wallet: for instance, a retailer could offer a discount or exclusive premium for customers paying via NFC.
Deutsche Telekom will be partnering with Isis to introduce NFC payment methods in the United States in conjunction with AT&T and Verizon.
NFC-enabled mobile payments systems may have appeal to consumers as a convenience feature, but a new survey from Accenture shows some wariness. Some 45 percent of active mobile device users interested in mobile payment technology, but 73 percent of those same users expressed “significant” privacy and security concerns about the technology. However, those fears may be easily overcome: the survey also found 62 percent of consumers who typically use a credit card for non-telco purchases would use their mobile phones to pay a bill if they got a 20 percent discount.
Google’s Android 3.0 “Gingerbread” will have built-in support for NFC technology, and several devices from Samsung, Motorola, Sagem, LG, and Nokia already have NFC hardware. NFC support is also widely expected in the next version of the Apple iPhone.