NFC Mobile Payments

When customers use their phones to pay for purchases at supermarkets, restaurants or stores, those payments are in part powered by near-field communication (NFC). NFC is a type of wireless connection that lets two devices in close proximity to each other communicate. A smartphone with NCF enabled can send data to a nearby credit card terminal, for instance.

NFC makes paying more convenient for customers and businesses. If your company isn’t yet accepting NFC mobile payments, learn more about how it works and the benefits of using it.


What Are NFC Mobile Payments?

NFC mobile payments are contactless payments. To make a mobile payment, a person must first have a smartphone with NFC enabled. They also need to install a digital wallet app on their phone. A few different digital wallets are available, including Google Pay and Apple Pay. Each type works with a specific type of mobile device. Apple Pay works with iOS devices, while Google Pay works on either Android or iOS devices.

Once someone has a digital wallet on their phone, they can load their payment information onto it. They will provide their credit card information, including their account number, expiration date and security code. The app stores that information securely. When they want to make a payment, they can open the app, choose their payment method and wave their phone near the credit card terminal.


How Do NFC Payments Work?

NFC is a type of radio frequency identification (RFID) that lets devices talk to each other when they are within a certain range of each other and when NFC is enabled. Most smartphones let users toggle NFC on and off. RFID isn’t new—it’s been used for decades in barcode scanners. However, NFC is a newer form of RFID—it’s been in use since the start of the 21st century.

NFC uses a specific frequency that lets devices talk to each other when they are very close together. For an NFC payment to work, the user typically needs to place their mobile device about 2 inches away from the NCF-enabled terminal.

When an NFC-enabled mobile device with a digital wallet app installed gets within range of an NFC-enabled credit card terminal, the two devices start talking. The smartphone sends encrypted payment data to the terminal, which then sends that data on to the appropriate banks. The banks approve or deny the transaction, the data gets sent back to the terminal and mobile device, and the payment is completed (or declined).

The entire process takes just a few seconds. It’s usually much faster than swiping or inserting a credit card for payment and quicker than handing over cash and waiting for change.


Advantages of Using NFC Mobile Payments

NFC payments offer benefits to businesses and consumers. If you haven’t yet started accepting mobile payments, here are a few reasons to do so.

They’re Fast

A lot happens when a customer presents their mobile phone to pay, but all of it occurs in pretty much the blink of an eye. Data travels from phone to terminal more quickly through NFC than it does when a card is physically swiped or inserted into the machine.

All that speed is good news for business owners, as it lets you serve more customers in less time. It’s also good news for buyers, as they don’t have to wait a long time at the checkout counter for a sale to complete.

They’re Convenient

Who hasn’t forgotten their wallet at home, only to realize it when they’re at the front of the checkout line? With mobile payments, all a customer needs to do is pull out their smartphone to pay for their groceries, meal or new wardrobe.

NFC payments also allow for a smoother transaction process. Most people keep their phones within easy reach, but their wallets are securely tucked into a bag or pocket. Using mobile payment eliminates the need to dig around for a wallet. Customers also don’t have to wait for change or spend time counting out the correct number of bills.

They’re Secure

NFC mobile payments are as secure, if not more secure, than card payments—and they’re way more secure than using cash. If someone loses cash or has their wallet stolen, there’s no way to get it back. But, if someone loses their smartphone, they can lock it down to prevent anyone from accessing it or their payment information.

Digital wallets often have multiple security features built in to prevent unauthorized access. For example, a digital wallet may open up after the phone’s owner scans their fingerprint. Some apps use facial recognition software and only open after scanning the phone owner’s face. A slightly less secure option is for the app to require a person to input a code or draw a pattern before getting access.

When sending data from the phone to the credit card terminal, digital wallets encrypt the information. If a third party intercepts the payment data, they’d have to spend a lot of time and effort cracking the code and deciphering the information.

Some digital wallet apps also use a security measure called tokenization. Once the user provides their payment card information to the app, the app creates a series of random numbers, which it then uses in place of the payment card. Outside of the NFC payment system, the random numbers are worthless. If a third party gets access to them, they wouldn’t be able to use them for anything.

They Give Customers Options

For some customers, the more payment options they have, the better. Adding NFC mobile payments to your business’s point-of-sale (POS) system means your customers have another choice when it’s time to complete a transaction. They can feel confident running to the store with only their phones.

They’re Flexible

Most digital wallets allow customers to use them for in-person payments—such as when someone is picking up their morning coffee or grabbing groceries after work—and online payments, such as placing a weekly Amazon order.

They’re Easy to Set Up

Your business needs a terminal that accepts NFC payments before you can start accommodating digital wallets and mobile payments. If you use a complete payment solution, your card terminal will already be NFC-enabled, making it easy to start accepting digital wallets.

Once you have an NFC-enabled terminal, your business is ready to accept mobile payments from customers, speeding up their time in the checkout line and making life more convenient for everyone involved.


Examples of NFC Payments

Digital wallets turn smartphones into payment methods. The type of digital wallet a person has installed on their device depends on the operating system. Some of the most readily available NFC payment digital wallets include:

Apple Pay

Apple Pay works on iOS devices, such as the iPhone, and pre-installation means users don’t have to download the app on their own.

Apple Pay users can save their credit or debit card information to the app, plus membership cards and gift cards. Individuals in the U.S. have the option of using an Apple card or Apple cash, which is digital prepaid card. Users can choose which payment method to use as their default payment.

When someone wants to use Apple Pay to complete a purchase, they need to open and unlock the app using either FaceID, which scans their face, or TouchID, which scans their fingerprint.

Samsung Pay

Samsung Pay is similar to Apple Pay but only works on Samsung devices. It works the same as Apple Pay does, letting individuals save their membership cards, gift cards and debit or credit card details. Users can also take advantage of a prepaid Samsung card when using Samsung Pay.

For security, the app only opens after scanning the user’s iris or fingerprint.

Google Pay

While Apple Pay only works with iOS and Samsung Pay only works with Samsung, Google Pay works on Android and iOS devices. It allows users to save payment information that they can then access to make payments from the Google Pay app or when using the Chrome browser.

To use Google Pay, a person needs to verify their identity. They can use their fingerprint or a personal identification number (PIN) or draw a special pattern.


How Can CSG Forte Help You?

Are you ready to accept mobile payments at your brick and mortar location? CSG Forte’s payment solution can help. Our platform makes it easy for customers to pay using their chosen method, whether it’s their digital wallet, a physical card or cash.

If you’re ready to streamline payment at your business, contact CSG Forte today to learn more about our payment solutions.