The cellphone is expected to become the next-generation travel card, but high costs will delay the technology being rolled out in SA in the short-term.
Speaking at the ITWeb Mobile Payments conference, held at the Campus in Bryanston, yesterday, head of CJ Systems John Aldridge provided an overview of how handsets have evolved to facilitate mobile payments.
“In the last two years, all focus has been in cooperation between bank card issuers and handset manufacturers with near field communications (NFC) being a key development,” said Aldridge.
NFC is a short-range, high frequency wireless communication technology which enables the exchange of data between devices.
PayPass for taxis
Aldridge pointed out that the South African Reserve Bank has formally committed to using PayPass from MasterCard, which uses NFC technology, as the preferred payment option for taxis.
However, he said this will take time to roll out. “Whether we like it or not, the cellphone will become the travel card. NFC capabilities will be built into mobile handsets. The problem is that we don't really have NFC-enabled cellphones in the country yet.
“In addition, there will be a high incremental NFC costs for handsets which the consumer will have to pay for. I think the technology is going to come, but it won't be in the short-term.”
Costly tech
According to Aldridge, the integrated NFC technology costs around $50 on top of the average handset, which costs the consumer $35. He noted that costs for the technology would have to come down for it to be widely adopted in Africa.
He gave examples of where NFC has worked, namely the Oyster and Octopus contactless cards in London and Hong Kong. He added that security issues need to be addressed as the Oyster card has been cracked, with people having figured out how to add value to that card.
Pocit MD David Reynders agreed that the mobile handset will become the preferred way to facilitate remote payments such as bills, e-commerce and prepaid. He says Pocit is working with the government to roll out a solution that allows users to pay their speed fines via the Pocit solution on their handhelds.
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