Near field communication is revolutionizing the way in which we makes transaction and become a fundamental enabler of the contactless payment system. NFC is emerged as a milestone is making seamless, secure transactions, and quick payments. This blog will provide an overview on how NFC works in making payment and its adoption in growing payment system. To know more about its role and trends in the global contactless payment market kindly to a report published by Coherent Market Insights.
How NFC Works in Payments:
It allow for wireless data transmission over short distance ranging from 4 inches to 10 cm. NFC enables the communication between the payment terminal and the devices in contactless payment methods. It include a smart watch, smartphone, and a contactless card that are equipped with NFC Chips. This communication is done when the user will take the NFC enabled device close to the payment terminal for a secure transaction.
This is considered as a fast and efficient process:
Initiation: the user will tap their NFC enabled devices on the payment terminal
Data Exchange: The NFC device integrated in the chip will exchange the encrypted payment information with the terminal. It will provide the user to authenticate the payment through biometrics, PIN, and other methods.
Completion: The payment get processed and the transaction will get confirmed in real-time.
NFC makes the use of radio waves, that doesn’t need any physical contact between the terminal and the devices. This is considered as one of the main reason of increasing popularity of contactless payment in NFC sectors.
The Growing Influence of NFC in the Payment Market:
The adoption of NFC in payment method has surged because of its security and convenience features. As customer demand for fast, safe, and convenient ways of making payments, the business and financial institution have embraced NFC as a solution. In today’s world NFC is considered as an integral system to make payments via mobile wallets to contactless credit and debit cards.
The usage of NFC in contactless payment methods is undeniable. It not only used to enhance the customer experience. It also provide the merchants to make contact with contactless payment solution and improve the efficiency.
Advantages of NFC in Payment System
- Speed and Convenience: these payments can get processes quickly within a second. It also reduced the waiting time and enhance the customer experience.
- Security: It is considered as a most secure method due to the use of tokenization and encryption. It ensures that sensitive payment information will not transmitted in plain text.
- Hygiene and safety: People are more health conscious and NFC provides transaction without any physical interaction. It will support a hygiene shopping experience.
NFC Adoption in Payments:
The widespread adoption of NFC technology in payment system is boosted by the shift towards digitalization. Due to the rising penetration of smartphones, the contactless payment system has become more ubiquitous. The ease of making payment and growing demand for contactless payment will ensure NFC to be a pivotal technology in payment industry.
