Technology is just a touch away
Near-field communication (NFC) is making life easier and more convenient by making it simpler to conduct transactions, exchange digital content and connect electronic devices with a touch.
NFC is a technology standard that harmonises and extends existing contactless standards. Developed in the West, NFC is gradually taking off in Asia.
'We've seen a boom in the NFC industry this year, with more and more countries realising the benefits of employing convenient card and cash-free technology,' says Isabelle Alfano, director of CARTES events for Comexposium.
China is seen to be the next launch pad for NFC technology.
According to a Smart Insights' White Paper on NFC in China 2011, the mainland has started developing mobile payment solutions to take advantage of NFC. China Mobile, China Unicom, China Telecom and China UnionPay have all rolled out NFC projects or NFC-like technology, such as RF-SIM, SIMpass or MicroSD.
These solutions are now used by consumers in major Chinese cities to pay for food and beverages, and public transport, with their NFC-enabled mobile phones. 'China's huge subscriber base indicates huge potential for NFC deployments; less than one-third of users have access to mobile payment technology,' Alfano says.
Japan is also promoting the deployment of NFC technology.
The country uses Sony's FeliCa technology in fast-food restaurants, subways, taxis and vending machines.
Other Asian countries are also catching up in NFC deployments. Korea Telecom is distributing NFC-enabled iPhone attachments preloaded with a MasterCard PayPass application.
In Singapore, a local taxi operator is installing NFC payment terminals in its vehicles, while the government is promoting the EZ-Link project, which uses NFC cards for transport and retail payments.
In Hong Kong, Pacific Coffee last year launched the first card-free settlement convenience with its iPhone app linked to PayPal.
'Although the overall adoption of NFC in Asia is slow, except for Japan, compared to the West, we believe it will quickly catch up,' says Ming Zhou, chief technology officer of HierStar Group.
'We see significant promise for taking NFC technology beyond cashless payment into new, complementary physical access control applications,' adds Simon Siew, HID Global managing director for Asia-Pacific.
'The industry has made great progress in moving payment applications onto NFC smartphones; the next step is moving our keys and smart cards there as well.'
According to Siew, there are several potential applications for NFC-based mobile phones carrying digital credentials, including payment for electric vehicle charging stations.
Students can also use NFC mobile phones for campus transit systems, to check out library materials and identify themselves before taking tests.
He cautions, however, that the industry is also faced with increased security threats. 'It is critical to provide a trusted platform to ensure mobile security,' Siew says.
Gilbert Leung, vice-president for sales and marketing at Advanced Card Systems, shares that view. 'Since monetary transactions are involved in NFC applications, security of the system must be enhanced by incorporating fingerprint identification features on mobile phones.'
With the added security features, Leung says that within two years consumers will be able to tap their phones to NFC-enabled readers and verify their fingerprints to authorise payment - all within fractions of a second.
Siew says HID Global is working with handset manufacturers and NFC semiconductor suppliers to embed next-generation access control technology directly into phones and related devices.
According to research firm IHS iSuppli, manufacturers will ship about 550 million NFC-enabled phones in 2015. iSuppli also predicts that 10 to 15 per cent of all phones will have NFC in 2012, up from about 1 per cent today.