An up-and-coming payments technology vendor has created a way for smart phones to make contactless credit and debit card payments and for merchants to accept near field communication (NFC) payments.
Zenius Solutions, a California startup, is marketing a pair of solutions aimed at enabling any mobile platform to support contactless transactions – ZeniusMobilePay, which enables NFC phones to send payments, tickets and coupons to a POS system or other payment acceptance mechanism and ZeniusMobilePOS, which allows merchants to accept contactless payments from any smartphone.
“We’re at the right time, in the right place,” John Wiese, Zenius’ president and CEO, told EPI. “People want to embrace this technology, but in-house solutions are too expensive in this economy. The idea from a vendor perspective is to get as many people supplying terminals, mobile wallets and software to adopt the NFC engine.”
The Zenius payments product features two components. One part fits into a phone’s existing SIM card slot and is linked by a flexible cable to another section that includes the NFC chip and antenna that can be attached to the outside of the phone, though most phones don’t require the cable. Zenius provides the software solution which combines with the hardware – from mobile phone technology developer Bladox SRO of the Czech Republic – to enable NFC on any GSM mobile phone.
The setup enables users to make contactless payments at the POS and to manage their various card accounts through a mobile wallet application that consumers can install on smartphones.
“Until we get NFC-enabled phones, we need an interim solution,” Wiese said. “We have millions of devices out there that can and will make NFC payments with a relatively simple fix, and the applications are vendor-neutral, so it doesn’t care what kind of smartphone you have.”
The application can work with MasterCard, Visa, Discover and American Express cards, Wiese said, adding that he envisions a portal not unlike the Apple App Store, where consumers can manage payment types online and add capabilities.
While several financial institutions have piloted phones with NFC chips that deliver contactless payment capabilities, the market awaits widespread deployment of NFC-enabled devices.
Some companies have sold stickers that have contactless-payment features and are commonly attached to phones as an interim solution, but they do not actually communicate with the mobile devices.
Zenius’ system provides an easily-installed way to make NFC payments for consumers who already own smartphones, and might not be interested in replacing them when new models become available with built-in NFC chips, Wiese said.
ZeniusMobilePOS is being marketed as a way for merchants to accept contactless US and EMV bank card payments and will also handle a variety of contactless couponing, ticketing, transport and other applications, Wiese said.
Making it easy
Part of the appeal, he said, is in simplifying the process for merchants and bank acquirers.
“Say a bank wants to do a closed-loop card programme, and they want to add loyalty and ticketing,” he said.
“Today, they would have to add those by writing specs and going out to the merchant terminal and have them implement it, then going to the card manufacturer and having them implement it and then the back office side… it really gets to be a lot of people involved and it becomes pretty daunting for the bank.”
So Zenius provides a software solution that provides all the necessary implementation to enable the merchant terminal to accept NFC payments with the flip of a switch – cutting several time-consuming steps out of the process, Wiese said.
ZeniusMobilePOS is currently running on Nokia 6131 and 6212 handsets, but can be ported to additional hardware platforms upon request. The company also provides libraries under the Zenius Contactless Payment Acceptance application programming interface to allow the easy addition of contactless payment acceptance to an existing solution.
From an issuer standpoint, whether in payment or transportation or identity, or closed-loop systems, the Zenius architecture can drop into the systems and allow issuers to add new contactless NFC applications to the merchant acquisition side and the consumer side.
Zenius is not alone in attempting to close the NFC gap. A Dallas-based company, DeviceFidelity, is testing a device called the In2Pay solution, which can function as an NFC passive tag and as a reader.
A similar microSD NFC card, provided by startup firm RFinity, is currently being pilot tested on the campus of Brigham Young University in Utah by students using their university accounts.
The In2Pay solution, however, takes the technology to credit card companies and is compatible with existing NFC-enabled POS terminals already in use around the United States, using the encryption protocol accepted by major credit and debit card providers.
According to mobile technology vendor DeviceFidelity, about 65 percent of phones deployed around the world are already equipped to use In2Pay cards.
After receiving an In2Pay microSD card from a credit card company or bank, a consumer can insert the card into his or her phone, then follow a few prompts on the phone’s screen to enable it to link to the user’s credit card or bank account, if so desired, in order to set up a payment system.
Once that occurs, the user can then tap the phone against an NFC reader at a retail location, rather than having to take cash or a credit or debit card out of a wallet in order to complete a purchase.
Though NFC-ready phones are rare now, Nokia has said that it plans to make NFC technology a standard feature in its phones by 2012, a move widely believed to unleash a wave of innovation around NFC applications.
“We are nearing a time period in which NFC will grow rapidly as the devices catch up,” Wiese said. “That’s why we’re building this infrastructure now, and providing an easy way for merchants and issuers to get involved with NFC.”