Industry must address consumer fear of NFC

07 Aug 2008

NFC-enabled handsets are arriving but the industry must first address skepticism among merchants and end-users, according to Juniper Research.

A Juniper report forecasts payments made via NFC-enabled devices will reach $75 billion in five years.

NFC (or near field communications) allows handsets to transact with preconfigured readers via short-range wireless. The technology is suited for low-value purchases such paying for a movie ticket or any consumer item. "NFC will achieve traction initially in developed countries and regions, with Japan already leading the way with FeliCa-enabled phones," said Juniper analyst Howard Wilcox.

"North America, Western Europe and countries such as Korea, Singapore and Australia are likely to see service take-up," he added.

Juniper predicts limited shipments of NFC-enabled devices until next year but the market will begin picking up by 2010. China and the Far East (Asia) will be among the top regions to adopt NFC.

Wilcox, however, said: "Whilst trial results so far have been encouraging, the industry as a whole will need to convince both consumers and merchants of the merits of yet another payment mechanism on top of cash, checks, and credit and debit cards."

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