Following a roll-out of contactless payment terminals across its hardware business Bunnings Warehouse late last year, Coles is looking at a wider implementation of the technology.
Contactless card and reader(Credit: Commonwealth Bank)
"Rolling it out further is something we're evaluating," Douglas Swansson, head of Payment Services for Coles, told ZDNet Australia at the Cards and Payments Australasia 2011 conference in Sydney today. He added that the main goal around deploying contactless cards is to improve the customer experience, so the technology must be implemented carefully.
"If we go too bleeding edge we may end up getting it wrong and damaging the customer experience," he said.
Swansson said that, so far, contactless cards were rating well amongst younger shoppers, but that the older generations were less willing to use it.
"Some [shoppers] aged 50 years and over are concerned about contactless card implementation," he said.
Swansson believes that this is because contactless cards are still a relatively new technology that haven't been explained to cardholders as well as they could have been.
"The Commonwealth Bank has done a huge job of getting cards out, but there's still a lot of confusion about what it is," Swansson said.
He added that in a recent straw poll of conference attendees, almost all delegates identified themselves as contactless card holders when in fact they were only in possession of basic chip-enabled cards.
Along with education, Swansson said that banks need to look at making contactless cards more sophisticated to better protect users.
"Chips should become more advanced," he said, suggesting that banks should implement specific profiles and restrictions on contactless cards.
Swansson said that retailers still on standard EFTPOS may even consider supporting near-field communication (NFC) chips in mobile phones as a way to leapfrog contactless card systems altogether, identifying convenience and security as a primary driver.
"The security of NFC is better, because someone will report their phone stolen in 20 minutes, whereas people usually report their card stolen in around 2 days … that's an advantage for us — that we can kill it over the air [in the event of theft], making it more secure," he said.
ANZ and Visa have been running such a mobile payment trial on iPhones.
Regardless of the particular technology behind cashless payments, Swansson said that the days of cash are numbered.
"65 per cent of payments are now done on cards. Over the next 10 years, that could be up to 90 per cent," Swansson said.