iPhone 5's lack of NFC doesn't matter, survey shows

CreditDonkey.com survey found that 68% of U.S. smartphone users easily prefer cash and credit cards to a mobile wallet

By , Computerworld |  Mobile & Wireless, iPhone 5, mobile payments

In a separate CreditDonkey.com survey of more than 1,000 online consumers (using PCs and other access), 60% said they trusted Amazon most with their credit card information, 30% said PayPal while Apple and Google were each the most trusted by 5% of respondents.

Google sponsors Google Wallet with several NFC-ready smartphones, a system introduced a year ago that hasn't gained much steam, analysts said.

ISIS, a consortium made up of Verizon Wireless, AT&T and T-Mobile, announced on Wednesday, the same day as the iPhone 5 was launched, that it was delaying the launch of its mobile payment service in two cities without giving a start-up date.

ISIS maintains that NFC is the most secure technology for modernizing payments.

Nonetheless, while NFC technology is widely used in South Korea and Japan for transit and for retail purchases, it is only starting to catch on in Europe and North America.

Part of the reason for the slow start is that just 2% of all merchants worldwide have installed terminals or software that can read NFC transmissions, according to Aite Group.

Avivah Litan, an analyst at Gartner, said that Apple didn't miss the boat by not installing NFC chips in the iPhone 5.

She noted that recent partnership agreements by Square and Starbucks and by Home Depot and PayPal for use of in-store mobile payment systems that don't use NFC technology "prove that [non-NFC] mobile payments can be as, or even more convenient for consumers than those with NFC."

PayPal's approach with Home Depot and other retailers allows an in-store buyer to input a mobile phone number and PIN on a terminal keypad to authorize a payment, while Starbucks scans barcodes on a smartphone with an optical scanner much the same way Apple's Passbook works.

While Starbucks has been using its optical scanning of barcodes on smartphones for more than a year, its impact on the public's perception of mobile wallets doesn't seem to have been picked up in opinion surveys such as the recent one by creditdonkey.com.

"I expect that context-aware mobile payments like Square and Starbucks will have a much bigger impact on U.S. mobile payments through 2014 than any NFC-enabled attempts," Litan said.


Originally published on Computerworld |  Click here to read the original story.
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