Near Field Communication

Currency has already made many transitions over the decades – from cold, hard coins, to paper money with sophisticated anti-fraud devices, to the plastic card era and the internet banking transactions that now take place due to banks being online and the widely adopted support of services such as PayPal and Google Checkout.

But is the next paradigm change on the horizon with the introduction of the digital wallet – or more likely, the introduction of payment methods via your mobile phone. We all know that most people now carry a mobile phone, which is likely to be in some way linked to your bank account (pay monthly contracts or top-up via credit card services), which makes it a perfect medium for digital transactions.

Nokia (amongst others), are investigating and developing “Near Field Communications” or NFC, which is the RFID standard being build into future handsets. NFC allows interaction between your mobile phone and near-by RFID tags that can be embedded with a variety of information or ‘tags’ which can then contain items such as URLs to the internet, telephone numbers, advertisements, tourist information, etc.

By delivering this information directly to your phone, it provides a digital link between your physical environment and your mobile phone. NFC though is being developed further to provide online payments via mobile phone – its currently in the testing phases at the moment and there are many difficulties yet to overcome (as with any wireless technology, how do you know that wireless advertisement tag belongs to the item your hoping to purchase and/or valid and free from risk). But imagine being able to approach a vending machine and your mobile phone wirelessly connecting to the machine, and then either via SMS or some other form, selecting the product you wish to purchase and then having the cost deducted from your mobile phone (or added to your mobile phone contract bill or some alternative, depending on if mobile phone carriers would want to get into the banking/credit game on a mass scale).

It’s a technology that needs work, but the development is happening and the issues will doubtlessly be overcome, if not in this form, then the digital wallet will happen in some other way.