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Topic: Mobility

You don't need NFC in your phone to pay for things without a wallet

Summary: NFC is a slick technology for mobile payments, but too often carriers block access. QR code payment systems are easier to use on a number of mobile platforms today.

Matthew Miller

By for Smartphones and Cell Phones |

I was confused by Google Wallet at first until I learned you can use NFC to pay for things at hundreds of thousands of PayPass locations around the US. I now prefer to carry my Galaxy Nexus since it is one of the only devices that reliably supports Google Wallet. Since I started using it though, I have learned of several other ways to pay for things with your mobile phone without the need for NFC technology.

While I think the future is in NFC and some kind of associated service for mobile payments, you can use several other clients that put a bar code on your mobile phone display that is then scanned by a reader at the store. I use this functionality every other day or so at Starbucks in Seattle with various Starbucks card apps on Android and Windows Phone.

I also recently discovered a cool service that works with my favorite lunch teriyaki place called LevelUp. This service works on iOS and Android smartphones in conjunction with a reader at the store where you scan in your barcode to pay. If you have another device, Windows Phone, BlackBerry, or Symbian then you should be able to visit TheLevelUp.com in your browser to get the barcode to appear after you login. I like the easy slider where you can set the tip percentage. When I first signed up I received a $5 credit so more than half my lunch was paid for. You can also earn credits by sharing with friends and by becoming a regular customer.

I see that LevelUp works in something like 17 cities, including Seattle, San Francisco, Chicago, Boston, Atlanta, and more with a growing number of merchants. The QR code used to pay for your items is NOT your credit or debit card, but a randomly generated token with no meaningful info in it so they appear to take security quite seriously.

James recently wrote about his experiences with parking that was managed by a mobile phone with a QR code element as well.

Given that NFC services are poorly supported by US wireless carriers, paying via QR code may be around for longer than we hope. Have you found a service or vendor that lets you pay via a QR code with your mobile phone?

Topics: Mobility, Hardware, Telcos

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Talkback

9 comments
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  • So, why are mobile payments better than Credit Cards?

    I'm quite serious here. I see these NFC and mobile payment articles all the time, but I've yet to see anyone explain why it's any better than just a plain old credit card. If anything, it seems it has quite a few cons. Opening a wallet app takes time, no matter what kind of device you have and isn't really any quicker than just quickly slipping out a credit card. The addition of a battery which can die can easily ruin your day if you go on a big shopping spree only to realize you don't have access to your cash because of a dead battery...admittedly, this could be solved somewhat by unifying charging cables and having a charging station at every checkout counter, but even that just seems like needless costs. I guess it's possible that it's a bit more secure because you can passcode a smartphone, but then again, you're opening up your account details to more points to be hacked.

    I'd really like to get a list of reasons why we actually need a technology like this, because it doesn't really seem like an obvious upgrade to me.
    Aerowind
    Reply Vote

    • Easier, faster tracking

      They can follow you around more easily, they don't just need to wait for when you use your credit card, they know where you are at all times...
      wright_is
      Reply Vote

    • Number of reasons

      NFC is far more secure than carrying around a plastic card with numbers anyone can skim. It also allows for a digital record of all of your purchases that is easily accessible on your phone in real time. You can monitor how much you spend, as you spend it. It works not just for credit cards but loyalty cards as well. And it's futuristic.

      Do we really need digital payments? No, but then again most people don't really need a smartphone and yet 50% of the US has one.
      Jeff Kibuule
      Reply Vote

  • No mobile...

    My biggest problem with mobilephone based payment systems is that I have to lug the flogging phone with me everywhere I go.

    When I just pop out to the shops, I don't take my phone with me.

    There are lots of places I don't or wouldn't take a phone with me, but because I always have to have ID with me (Germany), I (almost) always have my wallet with me.
    wright_is
    Reply Vote

    • The advantages may not be realized for some time, but ...

      The idea is that eventually (i.e. maybe years down the road) your Smartphone will be able to Digitally carry a lot more of your stuff (putting things in a centralized/backed up respository if we are lucky) .
      Case in point, my girlfriend probably has 20 "cards" in her purse for Clothing Shops, Pharmacies, Gym Membership card, etc...
      If you can take a picture of a bar code, store a digital QR code, etc... for ALL of these types of cards (again, it may be a few years) then all those cards can go away. I agree with you that for some people, simply carrying a credit card is easier, but being digital would better allow you to get coupons, discounts, etc... automatically sent to your "store account" and not have to carry that stuff around also.
      I think this is evolving. NFC seems like an O.K. idea, but I worry about NFC skimmers (just like those that skim ATM cards at some banks that aren't paying attention). QR codes would mean that they have to hook my physically into the system than an NFC skimmer (that could just be NEXT TO/UNDERNEATH etc... to the NFC reader).
      It will be interesting to see how things evolve, but NFC/QR/Barcode etc... has the POSSIBILITY of making things better for some, not necessarily for everyone.
      jkohut
      Reply Vote

  • Alternative to getting NFC in a phone - see example.

    Take a look at this: http://www.bmo.com/home/personal/banking/everyday/mobile/paypass. I ordered one of these up a month back. It's a plastic card that's thinner than a credit card and I just put it on the back of my phone between the phone and the case. It works great by just swiping my phone next to the reader. Wouldn't this accomplish something similar without having to get a new phone?

    As a side note, there's a limit on how much you can buy at one time with this, and there's no PIN needed so I'd say it's ripe for someone to just pick up this tag or a phone and go to town with small transactions. However, I'm sure the credit card companies have software to pick up on this type of fraud and would reject its approval in short order in this situation, and you do have the option of getting emails to let you know when transactions have been approved through this device.
    achilles heal
    Reply Vote

  • contactless and mobile payments, Don't confuse

    "So, why are mobile payments better than Credit Cards?" NFC is about contactless payments. We should use Contactless payments where it's a real win win situation. Small, fast payments (small is low risk/secure without pin). Public transport, canteen, the baker, find the long queues at peak hours! Let NFC prove itself for small payments, IMHO we should think about credit card replacement later. Just .. with very small payments nothing/not much to earn for carrier, bank or google. Thats a problem ;-).
    BMO is about NFC stickers. Some NFC stickers don't need a phone and are just for payments, other NFC stickers use bluetooth to communicate with your handset. At least 5 other options to "integrate" NFC on your phone. It's in fact about the secure element. http://www.nfc-phones.org/secure-payments-with-nfc-phones-4-hardware-solutions/
    chu190
    Reply Vote

  • Marketing Grads convince those with the chequebook...

    Of course it's a good idea! It's new and it will burn up more resources by creating change, which many people make their entire living from.
    Change the system and resell everybody the next version of what they already have. Probably in Marketing 101!

    How often have we seen incredibly bad decisions to change something? Remodel a perfectly good store which then looks half as good as it used to for example. Why not just refresh it with smaller changes for a 10th of the cost?

    Graduates will always be talking CEOs into adopting the great new thing to justify their existence and play with the new toys and jump the job queue to something that looks cool and does not fall into the experienced incumbent workers repertoire.

    The correspondents above are correct. NFC requires more complex technology, is less robust, less secure and is not a win for anyone other than the people selling the concept.

    QR codes haven't been utilised intelligently so far and could be used with existing technology. Why have a whole new phone when an NFC card could do the job. First let's get rid of the 20-30 plastic cards in our wallet and perhaps pay for phone-boxes, postage and parking before we try to convert all retailers to a new form of payment. Use the technology for convenience, not to reinvent the wheel. When you want NFC is for those occasions when you often don't have the change. The aforementioned plus say road tolls etc. Places where a skimmer would either have trouble making a decent dollar for their trouble or would be too quickly noticed.

    We had smartphones before the iPhone, but they were some of the most kludgy disorganised devices you could buy. Often, even the retail shop could not get features to work. The iPhone came out with less features, BUT THEY ALL WORKED. Let's follow that paradigm for rolling out these new technologies. Imagine if the government made different size coins every year! The people would revolt.
    zdnet@...
    Reply 1 Vote

  • I love levelup

    I've used levelup for about 9 months and think it works well for me as a consumer and iPhone user. As many have stated, there is has to be a perceived value for changing an existing system. Levelup does this for the consumer and business by providing incentives; it's not purely made as an payment alternative. The system is based on a loyalty reward system in which most restruants give about a 10% discount. Which is why i primarily use Levelup. The hair salon where my wife goes started using levelup and now she gets a $10 off every time she gets her hair cut, which is a 20% discount. Several of the places that we eat at Living in center city Philly where walking is the normal mode of transport has allowed for a high density of stores that participate. I'm likely moving to North Carolina soon and will miss using levelup. Using the system defiinitely convinced me of the convenience of using my phone for payments.

    If there is anyone who doubts the advantages of using newer technologies for payments, just look at how mass transit systems work. In Philly they still use primarily tokens with magnetic strip cards for monthly passes. All have to be bought with cash and it cost more if you just pay cash to the attendant. I have in my wallet a ny metro pass that I've had for a year. And it still has money on it and I can add more with a credit card. It may not matter but tokens are a pain; I can only imagine if I could pay directly with my phone at the turnstile instead of fumbling to translate currencies.

    Levelup works and using visual communication(qr code) is a great use of basic tech that is widely available. Hopefully it will lead to more people being convinced of the feasabilty of paying with phones untill NFC or another form becomes as common as debit cards.
    mr_sackett
    Reply Vote
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