Digital payments have taken over the entire market, changing the way people make payments and interact with monetary transactions. Be it a contactless card payment, or an e-wallet-enabled smartphone payment, digital payments are widely used and highly encouraged.
While it seems easy to simply tap your smartphone on a POS terminal and complete the transaction, there is a lot more going on in the process. Several technologies are responsible for bringing this convenience to payments.
One of the key technologies involved is Near Field Communication, popularly known as NFC. In this post, let us take a closer look at this technology and try to understand the role of NFC in contactless payments and eWallets.
What is NFC? An Overview
Near Field Communication is a communication protocol that allows two parties to connect their smart devices at a mere distance of 4cm or less. This short-range wireless technology allows instant transfer of data between devices. It is usually used to exchange files and digital information, secure payments, and simply connect devices.
The technology removed all the hassles that a user generally has to go through while connecting with another device. Unlike technologies like Bluetooth and WiFi that require adding a pin or password to be connected, NFC only requires you to be in the proximity of another device. Simply turning ON the NFC settings on your device and bringing it closer to another NFC-enabled device is enough to establish a connection.
This wireless connection and the convenience of no passcodes or connection protocols bring a lot of use cases with it. One of them is payments, hence NFC finds its usage in contactless payments and eWallets. Bank cards that you use today are NFC enabled and allow you to simply tap for a minor transaction.
Similarly, an e-wallet that supports NFC can be used as a payment method. The e-wallet converts your smartphone into a payment card that you can directly tap and complete the transaction.
Since an e-wallet can hold direct cash payments and save details of your credit card, you can actually do more with NFC when it comes to contactless e-wallet payments. This is also the reason why even the top ewallet app development services recommend enabling NFC usage in the app.
Use-Cases of NFC in Contactless Payments & E-Wallets
The ultimate use case of NFC is quite obvious i.e. contactless payments. NFC makes the entire payment process smoother. However, payments is not the only use-case that NFC offers. When combined with the potential of e-wallets, NFC can prove to be highly effective and useful in different walks of life.
Let us take a look at some of the use cases for the same.
Use Case #1 – Enabling Loyalty Program Benefits
Several vendors and service providers offer dedicated benefits to their customers via different loyalty programs. With the help of a direct e-wallet, a user can make the most of available loyalty benefits and redeem points instantly with a single tap, thanks to NFC technology.
Use Case #2 – Access & Permissions Control
There are several smart authentication solutions enabled in different buildings like offices, gyms, malls, etc. Places where you may be required to show your identity or access permissions to enter. With the help of NFC and e-Wallet solutions, you can add your authentication details to your eWallet and simply use the NFC solution to pass through these access points, without having to carry different credentials and cards.
Use Case #3 – Ticketing Solutions
Another interesting way the combination of NFC and e-wallets helps a user is in the ticketing solutions. When booked digitally, tickets can be easily added to the e-wallets and redeemed with the help of NFC. The contactless solution provides quick access to the events, saving you the hassle of standing in a queue for a long time.
Other than these use-cases, NFC makes it super-easy to make payments and enable safety in your card transactions. How? Well, let’s learn that by focussing on the benefits of NFC in contactless payments & e-wallets.
NFC in Contactless Payments & E-Wallets: Benefits
Convenience and quick transactions are definitely a few of the benefits that NFC brings to contactless payments. However, there’s definitely more to it! Here are some of the key benefits of using NFC in contactless payments & e-wallets.
- Seamless Experience: NFC brings seamlessness to every transaction. Gone are the days when you had to carry cash and count before paying, or standing in front of the POS, entering a pin for every small transaction. It is so easy to use NFC as it enables tap-and-go transactions via both your cards and smartphones (via e-wallets).
- Expanded Functionality: One of the best aspects of NFC is that its use-cases are not limited to payments. It offers expanded functionality, making it a solid integration in devices. It also allows a fintech app development company to innovate with the e-wallet solution they are planning to build, making it more futuristic and operational.
- Unmatched Simplicity: There is no rocket-science involved in using NFC. All you have to do is switch the toggle ON, or leave it activated forever and tap the point of access/sale for instant completion of the transaction. It adds to the convenience of a user and makes it accessible for a person who is not a highly tech savvy person.
NFC Technology – Bringing Convenience One Transaction at a Time!
Reading through all the benefits and use-cases that NFC offers in contactless payments and e-wallets, you might have got an idea how useful it is. The convenience, security, and versatility that it offers is truly a game changer. Hence if you plan to integrate an e-wallet in your application, ensure that it is NFC compatible.
Hopefully this post helps you identify the role of NFC in contactless payments and e-wallets. That will be all for this one. Thanks for reading, good luck!
