Jun 12, 2023

6 Key Takeaways from WSJ's "How Tap-to-Pay Works" Video

The Wall Street Journal's (WSJ) “The Tech Behind” series provides valuable insights into the innovative technologies that are revolutionizing our daily lives. In its latest episode, “Why Tap-to-Pay Is Safer Than a Credit Card Swipe,” the series explores the mechanics of tap-to-pay technology, delving into NFC (Near Field Communication) and its role in powering seamless contactless payments. 

Here are our key takeaways for consideration as NFC continues to grow as a transformative technology that is reshaping our lifestyles and work environments.

NFC delivers quick, easy, and secure transactions.

With a simple tap, users can effortlessly complete transactions by placing their NFC-enabled device near an NFC point-of-sale (POS) terminal. In mere milliseconds, the necessary information is exchanged. Notably, this operational efficiency doesn't compromise security. NFC signals are transmitted over a short distance, making remote hacking nearly impossible. Furthermore, the secure chip within the user's device or card ensures a protected connection.

NFC can be active or passive.

An NFC device can be either active or passive. Active NFC devices can send or receive data and are commonly used in smartphones, generating power to enable an action. 

Passive NFC devices can only receive data, but this unlocks a major benefit – they have the capability to take power from the active NFC element they are connecting to, known as power harvesting. This means that low-power and static devices can be NFC enabled without needing to have their own power source, making them cheaper to produce and easier to design. It also means that if an active NFC device runs out of power they are still able to function as passive devices.

NFC seamlessly integrates into various designs.

NFC chipsets and antennas are compact and slim. Combined with power harvesting, NFC solutions can be integrated into almost any device. Smartcards can become thin and portable, wearables can be compact without compromising aesthetics, and smartphones can remain lightweight while accommodating additional functionalities.

NFC drives a constant emergence of new use cases.

While NFC initially gained traction through smartcards for transportation ticketing, its applications have expanded significantly. Transit cards paved the way for contactless payment cards, which, in turn, led to mobile and wearable payments. Today, NFC enables merchants to use off-the-shelf consumer devices, such as smartphones, as POS terminals. 

However, NFC's potential extends far beyond payments. Industries like healthcare leverage NFC for wireless monitoring, while connected car technology and the ability to charge small consumer appliances such as earbuds showcase the versatility of NFC. Ongoing innovation in NFC technology is driven by its widespread availability in billions of devices, close-range security, and simple tap-to-interact user experience.

Adoption rates vary based on geography, but not for long. 

While some cities and nations welcomed tap-to-pay technology well over a decade ago, most notably London and its Oyster Transit Card, others are only just embracing it. Merchants had previously been unsure about investing in upgrading their terminals, however, the pandemic led to a surge in demand for quick, hygienic payment solutions, changing consumer behavior and merchant priorities.

NFC Forum Standards Drive NFC Technology Success

NFC Forum standards ensure seamless interoperability among NFC devices and created four distinct modes of operation:

  • Use your smartphone or wearable devices for making contactless mobile payments, accessing restricted areas, or as a transportation ticket by tapping it against a compatible reader using Card Emulation mode.
  • Communicate and wirelessly charge low-power devices such as wireless earbuds, smart watches, digital stylus pens, headsets, fitness trackers and other consumer and IoT products at a power transfer rate of up to one watt using NFC’s wireless charging mode.
  • Open websites, get product details, store web links, or share contact details using NFC’s Read/Write Mode which reads information from NFC tags and enables users to write their own data. 
  • Easily share photos, videos, or files by touching devices together using NFC’s Peer-to-Peer Mode. No cables or complex setup is required.

These standards have been instrumental in fostering trust in technology and its many applications, which inspires further innovation across new sectors and industries.

Learn More

Here are three ways you can stay at the forefront of NFC technology with NFC Forum:

  • Join the NFC Forum. From our free Adopter to our Sponsorship level of membership, we have a membership option that fits your needs. Learn how to join our community now.
  • Access our valuable resources: Stay ahead of the curve by accessing our collection of NFC specifications, white papers, webinars, and use cases
  • Check out our Product Showcase: Explore our Product Showcase to discover cutting-edge NFC-enabled products and innovative design concepts.