Meet the Smartphone: your new wallet11/12/2014
Anyone can point out the revolutionary technological advancements in the past 50 years — the personal computer, the cell phone, the Internet. The real trick is picking out the slow-burning tech gems that will one day change everything. The most glaring example might be the potential digital wallet that will one day replace our physical wallets with our smartphones.
Last month Apple made a big splash with the release of “Apple Pay,” a mobile payment service that enables iPhones to digitize credit and debit card information, allowing the phone to replace them. It seems so simple; the most successful tech gadget replaces the need to fumble through your wallet for charge cards. Apple-acolytes across the country gave the company a standing ovation for another innovation that will certainly flip the world once again.
But it hasn’t. Apple Pay has only brought to light a service that has been available for more than 10 years called “Near-Field Communication” (NFC). Long before Apple Pay’s day in the sun, NFC powered virtually contact-free payments with tools such as Mastercard’s PayPass and Visa’s payWave. Similar to Wifi or Bluetooth technology, NFC allows for wireless transmission of data with the caveat that the field of transmission is much smaller, making it ideal for monetary transactions. Since 2003, Paypass and payWave have allowed users to tap their credit cards at checkout counters for payment instead of swiping a magnetic strip or handing their card over to a cashier or server.
NFC-endowed smartphones have pretty much the same feature. By tapping phones together or holding them extremely close, users can transmit pictures, mp3s, videos, weblinks and currency. While Apple Pay may be the latest, it certainly is not the first mobile payment system. Google Wallet has been on the market for three years with little to no fanfare. Starbucks has been accepting NFC mobile payment via its proprietary app for more than a year (and has been dominating the NFC market). Amazon Wallet launched in July and has been gaining steam due to Amazon customers being so used to paying for products via Amazon’s ubiquitous online checkout system.
Still, none of these competitors are the real hurdle that Apple needs to clear. Almost as quickly as Apple Pay hit the iPhone App Store, it found itself shut out from several major retailers. Walmart, Target, Best Buy, Lowe’s, CVS Pharmacy, Hy-Vee, Shell-Oil, and many more brick-and-mortar goliaths have shunned Apple Pay, refusing to accept the mobile payment system in favor of their own, “CurrentC.” Developed by Merchant Customer Exchange, CurrentC offers the same features as Apple Pay, Google Wallet and all the rest with one major difference: It has the collected financial backing of the aforementioned retailers.
Do you think Walmart and Target would band together over something just to see it torpedoed by a competitor? Absolutely not. There is some speculation that the CurrentC retailers might soften and allow Apple Pay into their stores, but why should they? So what if a few early adopting tech geeks are up in arms because they can’t use Apple Pay to buy their groceries or washing machine? Not Hy-Vee or Best Buy. If you really want to use NFC, CurrentC is ready, willing and just as serviceable as your Apple-provided application.
If Apple Pay never breaks through the CurrentC blockade, it doesn’t matter. The real celebration is its success in bringing NFC into the limelight and showing everyone another cool trick their phones can do. Personally, I doubt NFC payments will replace credits cards and cash transactions. How much personal and financial information can we store on our cell phones before we wake up and realize we’re storing all our private data on an unsecure device? CV
Patrick Boberg is a central Iowa creative media specialist. Follow him on Twitter @PatBoBomb.