Further Information
Payments
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Policies & Issues: Payments
CONTACTLESS PAYMENT
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The way in which we pay for goods and services has changed significantly over the last few decades. Things have moved on at pace, with chip and PIN being the latest development in the retail payments area. The recent introduction of Chip and PIN saw the biggest change in retail systems since decimalisation in 1971, requiring a big change in processes and hardware for the retailers and a behavioural change from the Consumer's point of view.
The technology sector continues to surge forward and look for ways of further increasing the convenience and speed of payments in the UK. One emerging technology is contactless payment. Several trials have been taking place in the US and Visa and Mastercard have been in discussions about taking the technology forward.
How the technology works
The technology works by using radio frequency to transmit data from the device (credit card/key fob/mobile phone) to a receiver. The device needs to be waved near to the reader and does not require direct contact to obtain the data.
Early indications from the trials are showing that the cost of radio frequency identification (RFID) readers is already price comparable to motorised contact readers, and the elimination all moving parts significantly improves reliability and operational reader life, reducing the overall life cycle cost. The inherent vandal proof properties are also ideal for unattended vending or payments, delivering improved system availability. Contactless payment will be a fast effective way of making payments negating the need to carry currency.
The future
If trials are successful in the US the technology will no doubt start to emerge in the UK affecting retailers and consumers. At the moment the trials are focused on low value every day purchases.
The BRC will monitor the trials and development within the UK and will keep members informed.
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