Recently I’ve spent lots of time in the US with customers getting ready for EMV. I have attended many trade shows and left them wondering if the US will focus on EMV or more ‘mobile’ solutions. I actually think we are still a long way away from a large scale NFC/mobile adoption or even close to any significant penetration with mobile payment sales. However, mobile payments still seem to have the majority share of conversations for payments in the US.
I like to try and link this view to a practical example and I managed to find a great one while travelling with my CTO a couple of weeks ago. My CTO loves to use the latest technology! Let’s face it he wouldn’t be a good CTO if he didn’t. Like the payments industry’s equivalent of James Bond’s Q, he always comes armed with test cards, terminals and a whole host of different bits of essential kit.
He often drags me along for his experiments to test his EMV contactless card in local retailers because of course all readers in the US will process a traditional mag stripe contactless transaction and most of the time it won’t work and we will have to swipe the card.
Anyway back to my NFC example! My CTO’s latest gadget is a Nexus 7 which has 3G and NFC built in (it’s very nice). He has loaded a wide array of cards into his Google wallet and is, as you’ll have realized by now, always very keen to test it out. On this occasion, he heads to a large department store that accepts Google wallet, selects something to purchase, and attempts to pay using his Google wallet. First problem is he has no 3G connection - it is being blocked in the US by his German purchased tablet. However, because he is a resourceful CTO-type, he uses his phone to set up a wireless hotspot and connects his tablet to the phone! Using this connection he opens up his Google wallet selects the card he wants to use and places it over the reader. So far, so good!
But then the wallet crashes and does not complete the transaction forcing him to use his contactless card (resulting in a disappointed look that his latest gadget didn’t work). Meanwhile, the Cashier looked increasingly perplexed as he juggles a 7inch tablet in one hand and a mobile phone in the other!
With all the time it took to attempt to process this transaction it seems like we are still very far away from a wallet-based NFC solution until there is better acceptance and a more standard solution offered in the market. In the large department store this was not much of a problem as queues at the checkout were not huge. However, if this example was in a QSR the cashier would have been rather irritated with the time taken to process a transaction. Also there needs to be a better understanding internally for the need to train cashiers on these new ways of paying.
EMV is the way forward for a secure foundation for all future NFC/mobile payments. It will allow more acceptances and put in place a standard global format. Of course EMV in the US is another blog entirely….