Smartphones Could Become Viable Alternative to Chip Cards by 2014
Estonian banks and tech firms are launching a pilot project that could see the sheaf of plastic in many people's wallets replaced by "tap and go" mobile phone solutions by late 2013.
Powered by NFC or near field communication technologies, the project is being developed by wireless operator EMT, Eliko Technology Development Center and the four largest foreign-owned banks in the country - Swedbank, SEB, Nordea and Danske.
EMT development director Kuno Peek told uudised.err.ee that the technology will require a 3G smartphone. Customers will have to switch to a different type of SIM before starting to use mobile wallets. Other than that, the m-bank card will have passwords similar to the current security features. The key difference is technological: radio waves will be used to communicate between the payment terminal and the virtualized bank card in the telephone.
"The new bank card will not be much different from the one already in use today. In addition, we are envisioning the electronic wallet of the future having room for all of the other things in today's physical wallet - customer cards, e-tickets, gift certificates, access permits and many other e- and m-services," said Peek.
Peek said they were trying to find a solution for Estonia where choice of operator would not matter. He pointed out that tap and go mobile bank cards were essentially a bank service.
He said the pilot was planned for January and that the solution could go commercial in late 2013 or early 2014.
"It is key for there to be enough smartphones on the Estonian market that support NFC and that there is a critical mass of payment terminals that support NFC," said Peek.
Kristopher Rikken