Westpac trials NFC payments on Android phones

The bank is running an NFC pilot program for three months that will involve 100 users, but hasn't committed to releasing a fully fledged NFC payment app.

Westpac has teamed up with MasterCard to pilot an Android application that uses near-field communication (NFC) technology.

Screenshot of Westpac's app.
(Credit: Westpac)

The new Mobile Contactless Payment app will work on Android NFC-enabled smartphones in conjunction with a "secure element" embedded in a SIM card. It uses MasterCard's virtual debit card technology; payments can be made by tapping phones on a PayPass terminal.

Around 100 pre-registered customers will be testing the app on Samsung Galaxy S III handsets, and the trial will run for three months.

Enabling NFC payments through mobile phones has been on the radar of major banks, but nothing solid has come out of it yet.

NAB teamed up with Visa and Telstra to test NFC in 2007 , but despite having a dedicated team on the project, it has yet to progress beyond the trial phase.

The Commonwealth Bank of Australia (CBA) launched the Kaching app for Android last month without NFC capability .

At the time, CBA chief marketing and online officer Andy Lark claimed that there were no phones on the Australian market that could enable secure NFC payments.

"Most Androids that go to market today have an NFC chip, and some claim to have it activated, but they generally only have the radio portion activated," Lark said. "They don't have the secure element activated — we actually need to get from Google or from the device handset manufacturer the specific code base to be able to do secure NFC transactions on those devices.

"No one has released those yet, and there is no timeline."

Although the bank was conducting the NFC trial, it hasn't committed to releasing a fully fledged NFC app to its customer base.

A Westpac spokesperson told ZDNet that whether an app will finally be released will depend on a number of factors, including results from the pilot program.

"Ultimately, the strategy is to make this service available to as many people as possible," Westpac head of mortgages, cards and merchants Axel Boye-Moller told ZDNet. "This pilot is for one particular handset, so we'll work on this trial and see what sort of things we learn from it.

"But there is no set time for a final release."

Westpac currently has 3.4 million customers using digital services, and 43 per cent of them use mobile phones to process payments online, according to Boye-Moller.

Apple iPhones do not have inbuilt NFC capabilities. It is rumoured that the iPhone 5 will have this feature, however.

Updated at 10.19am, 7 August 2012: added additional information on the pilot.