The Green Sheet Online Edition
January 1, 2012 • 12:01:01
The future of contactless payments
Contactless payments may have gotten a boost when Visa Inc. released its plan to accelerate adoption of the Europay/MasterCard/Visa (EMV) contact and contactless chip technology in the United States.
A new 23-page report from Mercator Advisory Group Inc. titled Moving Parts: EMV, NFC and Contactless Deployment in the U.S. looks at the implications and issues surrounding the push for contactless payment technology in the United States. The report evaluates Visa's decision to push EMV in the United States and what that decision may mean to the industry. It also offers insight into where contactless payments may be heading.
The authors also assess the impact new payment methods may have on how merchants make acquisition decisions. They additionally review other, slightly different, contactless technologies such as MasterCard Worldwide's PayPass card and Visa's payWave card.
Preparation required
"If Visa Inc's view of the world comes to pass, merchants, acquirers and issuers will be embarking on the most complex update to their payments infrastructure in 20 years," Mercator Advisory Group said in a press release promoting the study.
Among the issues the industry will face with widespread implementation of contactless payments is security. Mercator Advisory Group noted adoption of the EMV security standard is now going to be an issue in the United States for which stakeholders need to be prepared.
"The expected EMV rollout in the U.S. will require no little choreography on the part of merchants, acquirers and issuers because it will touch every payment device," George Peabody, Director of Mercator Advisory Group's Emerging Technologies Advisory Group, noted.
"Given the coincident timing of the EMV announcement and the arrival of NFC [near field communication], merchants have to carefully plan their POS infrastructure investments over the next five years and more.
Timing is everything."As consumers move to increasing adoption of smart devices, Mercator Advisory Group urges anyone who accepts, processes, routes or assumes risk for payment to prepare for accepting both NFC and EMV payments.
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