NFC Forum Money Transfer Candidate Specification Provides Alternative to QR Codes

I had a chance to talk with Daniel Orsatti from STMicroelectronics who also serves as the NFC Forum’s Group Chair for the Reference Applications Framework Working Group recently about the NFC Money Transfer Candidate Specification (NMT).  Below are some of his comments on this new candidate specification from the NFC Forum.

The specification allows brands, service and technology providers to simplify adding an NFC-based option to mobile wallets that currently rely on a QR code and a camera.  This solution improves the speed and efficiency of the payment process.  The specification development was driven by the NFC Forum’s Technical Committee with input from the Retail & Payment Special Interest Group.

1. What are the benefits of the NFC Money Transfer Candidate Specification (NMT) over QR code-based payment solutions?

NMT solution improves the speed and efficiency of the payment process by eliminating the need for a camera or scanner used in QR code solutions.  It provides an open framework which can be easily used by payment service providers to map their already defined data exchange for QR code-based payment solutions with NFC communication.  The specification works between all NFC-enabled devices such as smartphones, readers and tags.  NMT does not compete with other existing NFC-based solutions such as open loop and closed loop NFC-based payments.  In summary, NMT gives payment service providers and consumers the opportunity to take advantage of the simple and secure NFC-based payment solutions already in use worldwide as an alternative to QR code solutions.

For more information or to comment on NMT click here.

        2. What problem does the NFC Money Transfer Candidate Specification solve?

This specification enables the transfer of money either between two persons or between a person and a merchant. The idea is to have a very simple way to do it by just using an app.

The starting point was to define an NFC solution able to replace existing QR code solutions in Asia which require additional actions from the user to pre-select the right payment app and then  to activate and place the camera in the correct position.  Once the development process was started it quickly became apparent that there was an even greater need for an NFC solution. We have enlarged the specification’s scope to not only cover Asia use cases but to offer a generic framework covering payment systems.

3. What can we do today that we couldn’t do before now that the NFC Money Transfer Specification is available?

Compared with existing QR code solutions, the NFC Forum proposal is leveraging the intrinsic benefits of NFC technology to improve the user experience by simplifying user operations and enhancing the security levels, such as:

• simple tap vs opening a camera, targeting and scanning a code.
• quicker payment transactions without pre-selection of a payment app by the user.
• better security protection for users as the operating distance of NFC makes it more difficult for attackers to record the data exchange for payment transactions compared to QR code-based solutions.

For more information or to comment on NMT click here.

        4. Can you describe two or three use cases for the NFC Money Transfer Specification?

Today, many payment systems in the market allow you to pay with QR code solutions especially with small amounts of money. These payment solutions can be easily replaced by NMT as the same data exchange can be implemented with NFC communication.  The difference is that NFC brings the advantage of an even faster payment transaction and an even more convenient payment solution as the user does not need to select the right payment app,  activate the camera and hold it in exactly the right position to use it. With NMT  the selection of the right payment application is done automatically.

Another use case  could, for example, be the situation where  one person wants to transfer to his or her friend some money.  With NMT, by simply tapping their phones the payment app is selected and the transaction is executed.  The protocol further allows the transaction to be initiated either by the payer (I transfer you this amount) or by the payee (transfer me this amount).

5. Is anyone using the NFC Money Transfer Candidate Specification now?

The specification was published as a candidate specification. This allows the industry to review the document before this specification is adopted by the NFC Forum. For more information or to comment on the specification click here.

For more information or to comment on NMT click here.