TIM, a Brazilian carrier, has announced that it is beginning the new program using near field communication.
Wireless carrier from Brazil, TIM, has just revealed that it is launching a mobile payment pilot service that will be based on NFC technology in order to test the effectiveness within the region.
The program is running as a part of a partnership with Banco Itaú, a bank in Brazil.
It is also working with MasterCard, in addition to Redecard (a point of sale manufacturer) and Gemalto, which is a digital security provider. This joint venture pilot project will include a small beta testing group as well as the participation of 100 Rio de Janeiro and São Paolo restaurants.
The carrier has explained that they wish to learn more about the use and behaviors around NFC technology.
This pilot will help them to get to know the way that consumers wish to use NFC technology, what their expectations may be and how it works for restaurants. It will also provide the opportunity to train their employees internally and observe the type of challenges that they may expect as a result of a more extensive rollout.
Based on the results that they experience due throughout the length of the pilot program, TIM has said that it is considering expanding the use of NFC technology enabled mobile payments. This could mean that if the program is successful, the nearly 70 million subscribers at that company will have access to the service as soon as the second half of this year.
According to the TIM Brazil CMO, Roger Solé, “TIM has innovation as a strategic pillar and, once again, comes out ahead with the test of a technology that promises to be an important evolution of mobile. This partnership with Itau and our quest to evaluate the NFC model demonstrates our concern to offer solutions that bring more convenience to customers.”
The NFC technology enabled credit cards will be MasterCard branded. These will be used by the few participants in the pilot program. The over-the air account provisioning will be supplied by Gemalto. They will also be providing their well respected services management solutions. MasterCard PayPass tech will be used for making payments at the restaurant points of sale.
PayPal continues to snub NFC technology in mobile commerce
It is no secret that PayPal is not a fan of NFC technology. The technology enables mobile devices to collect and distribute information over very short distances. While the technology has seen use in marketing, its most well known for its uses in mobile commerce. NFC technology can effectively turn any mobile device into a payment platform, allowing consumers to make purchases for goods and services using nothing but their smart phones or tablets. While the concept of mobile commerce has becoming very attractive to consumers, PayPal believes that its reliance on NFC technology is a fallacy.
Use of NFC technology may lead to failure
In the past, PayPal has been somewhat outspoken in its opposition of NFC technology. Recently, however, the company has been growing more aggressive in its stance on the matter. According to David Marcus, president of PayPal, the technology may actually be harmful for the retail industry, which has come to embrace mobile commerce in a big way. Marcus suggests that NFC is not the right technology to facilitate mobile payments from consumers and that the more retailers focus on its use, the more likely they are to meet failure.
Poor experiences create tension in mobile commerce
Marcus suggests that NFC technology created a very limited experience for consumers, especially with their relationship to a retailer. Despite the somewhat simplistic nature of NFC technology, Marcus claims that consumers often have a bad experience when making purchases with NFC-enabled devices at retail stores. The president of PayPal notes that this experience is largely due to the fact that consumers are forced to make use of physical NFC terminals in order to make a purchase, rather than make purchases wherever they are using their Internet connection on their smart phone or tablet.
PayPal investing in alternative solution
PayPal has been investing heavily in an alternative to NFC technology. The company has been working on building a multi-channel solution that will allow consumers to make mobile payments without having to interact with a physical terminal or checkout system. The solution that the company has been investing in is meant to facilitate payments in-store and online, providing consumers with more flexibility in their mobile commerce interests.
