NFC and Mobile Payment Technology - Assignment Example

? NFC and Mobile Payment Technology NFC and Mobile Payment Technology Introduction: If the graphof technology in the past few decades is noticed then it can easily be noted that its growth has been very swift and rapid. Transforming every field of life, technology has played a very vital role in each of them. Things which were once considered impossible and unexpected, technology has made them possible and it is still growing. Just like any other field of life, technology has made some notable changes in the communication sector. It has made some unexpected communication processes possible and quicker at the same time. The purpose of this essay is to discuss and analyze NFC and mobile payment technology. Moreover, this paper will also discuss the societal and cultural impacts of NFC and Mobile payment technology. Figure 1: Life with NFC technology (Rackley, 2011) Understanding the New Trends; NFC and Mobile Payments: Saving time and labor, these new shifts in communication technology have helped the mankind in every possible way. However, it has set new trends in this world as well. Processes, which used to take weeks and months, are now just a click and touch away. Near Field Communication generally known as NFC is a kind of application or a standardized setting in the smart phones and all other similar devices such as tablets, iPads etc. The basic purpose of NFC is to set up a radio communication between smart phones or others devices by bringing them in touch with each other or at least in close immediacy depending on the requirements of the device. Once the connection has been established, a lot of tasks can be performed through it, such as contactless transactions, exchange of data / information, or a set up of multifaceted communications e.g. Wi-Fi. The communication can also be established between a NFC device and a powered off NFC chip (tag) (Coskun, Ok, & Ozdenizci, 2011). Figure 2: Image showing the working of NFC (Coskun, Ok, & Ozdenizci, 2011). With the growing technology, the payment methods are also made easy and simplified. All kinds of payments from utility to the bank and other financial payments are now on your fingertips. Mobile payment is a term which is used for the payments of different things through the smart phones. It is also known as mobile money, mobile money transfer or mobile wallet. It was a long time back when people used to carry bundles of cash and brief cases with them in order to make payments. With this technology this technique has almost diminished. At present a majority of people prefer paying through their mobiles for a variety of services. Instead of paying cash or cheque, they use their phones (Saylor, 2013). Trends: These new technologies have captured almost every country and have set new trends for the payments and transfer methods. According to the financial survey, the combined amount of mobile payments which were made by 2013 has reached $600 Billion globally. This amount is almost the double of what it was in the February of 2011 stating that the adoption toward the technology is increasing enormously. With the rise in smart electronic devices and the smart and catchy internet deals and the revival of Internet IPO it is believed that 2011 was the most transformative year in terms of technology (Schwartz, 2011). Impacts on Society and Culture: Talking about the societal trends regarding NFC and mobile marketing then according to an article published by CNN 2012 has been claimed as the year of NFC and mobile marketing (Cashmore, 2011). It was also claimed that the mobile payments and NFC will expand and blossom more in 2013. This defines that the adoption of the trend is growing largely in the world and people are becoming more inclined towards the technology. New methods and techniques are continuously evolving by the technology makers this year following the boom and success of NFC and mobile payments. People in developed countries are more likely to be influenced of the technology while it is proliferating in underdeveloped and third world countries with time (Ahson & Ilyas, 2012). People in the developed countries are found addicted to NFC and mobile payments and hardly keeps cash with them. They call it the era of plastic money which has been made possible only with the help of NFC and mobile technology. The rapid growth of this trend is because of the ease, simplicity and quickness of the technology. a person just have to wave his / her NFC enabled smart phone or device near any credit card reader located in a store, market, bank or anywhere and the amount will automatically deduct from your credit card. It has let the credit card replaced by your phone and has made the payment method effortless (Cashmore, 2011). Figure 3: Image showing NFC technology utilized at a store (Cashmore, 2011) The impact of NFC and mobile payment technology on society is very huge and notable. More and more companies are transforming and altering their technologies and payments method as per NFC and mobile payments. Since, it is believed that the closest device which one have all the time is a cell phone therefore, all standards and techniques are designed which rotates around it. It is considered as the best close range connectivity gadget for NFC and mobile payment. This will have both positive and negative impacts on society. Where on one hand, it is helping people to save time, labor and makes it easy for them; on the other hand, it is making it difficult for those elements which are not capable of possessing a cell phone or at least a smart phone (Pasqua & Elkin, 2012). It is believed that all the payments method will be transformed by 2015 which will have a strong drawback for a majority of people round the globe. Many of them will find difficulty to pay their bills as there might be no other technique left. Those who are not literate or are not familiar with the smart phone apps and techniques will have problems to use NFC and other mobile payment methods. The chances of theft will also increase as it will become easy for the thieves to transfer amounts into their accounts with just a click from other phones or devices (Svigals, 2012). If we specifically talk about the impact on the existing culture of payment techniques, then again it is badly affected by these new technologies. The traditional payment methods are quite in danger and have a serious threat from NFC and mobile payments. The cultural setting is moreover being disturbed as it is misbalancing the society by creating a boundary between the rich and the poor. It is obvious that the poor would not possess a smart phone or a credit card and therefore if all the traditional payment methods are diminished then it will be quite difficult for such individuals to survive. They would have no other option other than adopting the trend (Schwartz, 2011). It is undoubtedly said that the social and culture trends affect the behaviors, needs and significantly the paying patterns of consumers by every mean. If the social and cultural environment is triggered for any change or trend than it may affect the demand and supply curve for the payment methods from the developer’s point of view and from a consumer’s perspective as well. The society has been affected through its own acceptance of the technology. For the sake of leisure and easy lifestyle societies are adopting the trend more and more. Societies are becoming more self-oriented and the need for labor is getting decreased day by day (Saylor, 2013). Figure 4: NFC enabled cell phone working as a credit card (Saylor, 2013). NFC is not only confined for payments, transfer of data and financial statements, many companies like Panasonic and others have added NFC to rice cookers, speakers, refrigerators, cameras, televisions, business cards etc. Figure 5: NFC integrated appliances (Swedberg, 2013) It is undoubtedly creating a niche in the society, splitting the society into two. Smart phones are now coming with built in NFC and mobile payment options to differentiate and outstand themselves from their rivals. Apple has been able to lead the NFC market in smart phones and devices (Cashmore, 2011). Figure 6: The NFC Contenders (Handa, Maheshwari, & Saraf, 2011) The Future of NFC and Mobile Payment: If we talk about the future of NFC and mobile payments then it is not difficult to think that the future is bright for both of the technologies if they continue to grow with the same pace and the acceptance also continues. However according to a survey conducted by Gartner it is predicted that the increase in total percent of NFC by the end of 2013 will be 3 percent however the technology will get maximum boom by 2016 with the increase in NFC mobile phones and the contactless card readers. However many industrials believe that the technology will not become as famous as it was expected a few years ago; however, it is very popular at present. It is because the smart phones need the NFC technology for payment methods, and the cell phone manufacturing industries seem slow and reluctant while transmitting the technology into their smart phones (Handa, Maheshwari, & Saraf, 2011). Even if, the hand sets are totally transformed and enhanced with this technology, the chances of building contactless card readers at every POS seems impossible to some people. It is believed that the technology is a fail and was not a good idea. It is useless to discard the concept of wallets and introduce and replace them with NFC integrated smart phones. However, NFC can be found helpful in some other areas of everyday life (Coskun, Ok, & Ozdenizci, 2011). Figure 7: NFC in everyday life (Coskun, Ok, & Ozdenizci, 2011) However, the mobile payments have been found as an amazing technology, which has made its way efficiently in the societies and market. Mobile payments are expected to be accountable for 69% of the money transfers and payments in 2017 worldwide. With an increase of 44% the mobile payments has increased its value from $163.1 billion in 2012 to $235.4 billion in 2013. The future of mobile payments is expected much brighter as it is believed that the values will increase as high $721 billion by the end of 2017. The mobile payment users calculated according to a survey in 2012 were $200.8 Million; however, the number has increased to $245.2 million in 2013. By 2015 it is expected that the mobile payments users will be more than $670 million (Cashmore, 2011). Figure 8: Growth of Mobile Payment (Svigals, 2012). Conclusion: Hence, it can be said that technology has put humans in a serious confusion. ‘To do’ or ‘not to do’ is the case with the present communication technologies of NFC and mobile payments. Near Field Communication and Mobile payments are simply a two edged weapon, which has both positive and negative impacts on humans, society and culture. While it has saved time, labor, money, providing ease and comfort to the individuals (users) it has also fractioned the society into the rich and the poor. Moreover, the phenomenon seemed to expand rapidly and it actually did but at present it is growing slowly and is expected to boom in the coming three to four years with the installation of contactless card readers at almost every store, kiosk and markets. The future of NFC as predicted by few intellectuals is not as bright as it was predicted a few years back while Mobile payments has been able to dig its root deep down in the market and is expected to grow more. Reflective Log: While making this assignment, I had learnt a lot of things. The assignment has increased my research capabilities and has polished and sharpened them. I am able to understand the different aspects of technology particularly Near Field Communication and Mobile payments. However, the technologies seemed quite interesting to me from a distance, but when understood thoroughly these technologies do have a negative impact as well. The topic seemed not so interesting to me initially; however, as I continued my research I felt more and more into the topic. It would not have been possible without the help of my friends, family, teacher and my course instructor who thought I can do this and guided me in every step of the assignment and throughout the course. References Ahson, S. A., & Ilyas, M. (2012). Near field communications handbook. New York: CRC Press. Cashmore, P. (2011, December 19). The top 10 tech trends for 2012. Retrieved from http://edition.cnn.com/: http://edition.cnn.com/2011/12/19/tech/innovation/top-tech-trends-2012 Coskun, V., Ok, K., & Ozdenizci, B. (2011). Near field communication (NFC): From Theory to Practice. Sussex: John Wiley & Sons. Handa, R., Maheshwari, K., & Saraf, M. (2011). Google wallet - A glimpse into the future of mobile payments. Santa Cruz: GRIN Verlag. Pasqua, R., & Elkin, N. (2012). Mobile marketing: An hour a day. Sussex: John Wiley & Sons. Saylor, M. (2013). The mobile wave: How mobile intelligence will change everything. New York: Vanguard Press. Schwartz, G. (2011). The impulse economy: Understanding mobile shoppers and what makes them buy. California: Atria Books. Svigals, J. (2012). Bank on your smartphone. Bloomington: Xlibris Corporation. Read More