Ingenico, a Scottish company which specialises in secure payment solutions, is making plans for a UK and Ireland trial of contactless card reader technology, which will include payment via mobile phones equipped with near field communications (NFC) capabilities. The trial is scheduled to begin in Q1 2007.
Ingenico is best known for the Chip and PIN terminals used by retailers to take credit and debit card payments. The company has been involved in a trial taking place in Caen in northern France for the past year, organised by French bank Cofinoga.
The trial uses Ingenico payment terminals and contactless card readers in the towns merchants, which shoppers can use to make payments of less than 15 (10). To pay for goods, shoppers simply wave their contactless card in front of the terminal. To prevent fraudulent transactions, shoppers must authenticate the card by withdrawing cash from an ATM, or making a chip and PIN payment, after every third contactless transaction.
In addition to using their contactless cards, the 200 residents taking part in the trial can also make payments via their mobile phone. All triallists have been issued with a Samsung mobile phone equipped with a Philips NFC antenna and a Java application that enables the phone to function as a debit or credit card.
In addition to making payments, the phones can also download information loaded in Smarttags around the town. This includes bus timetables at bus stops, movie trailers on posters outside cinemas, and details of local events and attractions at public information points around the town.
Ingenico Senior Business Analyst Patricia Bateson told Mobile Marketing:
The merchants in Caen dont want the trial to end. They have seen a 25% increase in revenue per cardholder among the shoppers who can make contactless payments via their card or phone.
Ingenico is launching an all-in-one contactless enabled PINpad at the Cartes (Card) 2006 show, which takes place in Paris next week, and Bateson says reaction to the companys plans for a UK trial has been good.
We have commitment from banks and retailers, we just cant name any at this stage she says. All the feedback we have had has been very positive. We spend around 22 billion in cash every year in the UK, and its expensive for retailers to process. We also know that the dropout rate if someone is queuing to pay for something is much lower with a contactless solution than with cash or chip and PIN.
And as Bateson points out, there is more to NFC on a phone than just making payments. There are also potential applications in ticketing and transport.
Well have more news on the trial as it comes together.