Smartphone Credit Cards Arrive

Google Vice President of Commerce Stephanie Tilenius promotes smartphones as the wallet of the future. Picture: Mary Altaffer.

DON’T swipe aside the idea of smartphones as credit cards, writes Jennifer Dudley-Nicholson

We regularly shop on mobile phones, but rarely do we shop with them. That is poised to change as emerging technology transforms smartphones into makeshift credit cards that can be waved at the cash register.

The wallet-challenging additions are already trickling into Australia and more promise to arrive later this year in both phones and laptops.

But even its proponents warn that users may take time to become comfortable with new credit technology, though they insist the hi-tech transactions will be just as safe as traditional payments.

Near Field Communication, better known as NFC, is behind the trend to transform credit card payments.

NFC is a method of wireless communication, like Blue tooth, that uses a chip to transmit a high-frequency signal up to 10cm away.

 These NFC signals can be read by contactless payment devices such as MasterCard PayPass and Visa PayWave terminals now in retail chains including IGA, 7-Eleven and Woolworths. Coles has committed to add the technology to its stores by mid-2012.

Only credit cards could use these terminals until late last year when the Commonwealth Bank launched its KaChing app and accompanying iCarte case for the iPhone 4. The NFC case lets users wave their phone in front of a terminal to make payments of up to $100. The KaChing app is currently the most popularly downloaded financial offering in Apple’s App Store.

Google’s Galaxy Nexus phone, released late last year, also contains an NFC chip and appears to be the first in a wave of NFC phones destined for Australia.

Samsung, Sony, RIM and LG all showed off NFC-compatible smartphones at the Consumer Electronics Show recently and LG Mobile Communications national account manager Ben Glimmervene says Australia will see plenty of the new technology this year.

Glimmervene says every LG smartphone released from June onwards will come with a built-in NFC chip ready to support credit card use. But smartphones are not the only gadgets set to double as credit cards.

Intel also demonstrated Ultrabooks at CES that let users buy online by sweeping a credit card over the keyboard. Intel executive Gordon Dolfie says the company teamed with MasterCard to create the new feature that will be added to Ivy Bridge Ultrabooks mid-year.

Dolfie says the NFC feature works using new hardware that reads the credit card’s chip without storing any of its information. A credit card can be registered for use only with one Ultrabook to prevent fraud. Once a credit card is touched to an Ultrabook’s reader, it can automatically fill in financial details in an online order form.

Websites will require upgrades to use the NFC technology, but Dolfie says Intel has already started work with online shops to offer the service.

Smartphone Credit CArds Arrive. (2012, January 24). By Jennifer Dudley-Nicholson. Retrieved from http://www.adelaidenow.com.au/ipad/smartphone-creditcards-arrive/story-fn6ci13q-1226252156026.

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