The Commonwealth Bank and Coles have separately announced stickers that can be attached to smartphones in order to enable contactless payments.
While NAB joined with Telstra and Visa to run Australia's first trial of contactless mobile phone payments in late 2011, and ANZ
started theirs about a year ago. As far as BIT is aware, Commonwealth Bank is the only one of the big four banks to announce the general availability of this capability.
The Commonwealth Bank's CommBank PayTag will attach to an iPhone or Android smartphone and is used with the latest version of the CommBank app (announced today for iOS, Android and Windows Phone 8). This combination lets users turn the contactless payment function on and off as desired, as well as selecting which account is used as the source of funds.
Meanwhile, Coles and GE Capital have launched a consumer trial of Coles Pay Tag involving around 5,000 Coles Mastercard customers. Coles Pay Tag is a sticker that carries an NFC chip for contactless payments using MasterCard PayPass technology, along with a Flybuys barcode.
Coles Pay Tag apparently can be used independently of a phone, but a supporting app for iOS and Android is promised for early next year to add unspecified functionality - our guess is that it will have similar capabilities to the CommBank app.
Does any of this make a significant difference to small businesses?
This writer doesn't think so. The advantages of contactless payments are real, as they speed up transactions and are therefore particularly helpful during peak times at businesses such as cafes. And there's reportedly evidence that people spend more on average than when paying cash. But the actual functionality is fundamentally the same as using a NFC-enabled card.
And what will happen if the bill comes to more than $100 (the current limit for contactless payments) and the customer isn't carrying the card for that account?
Well over half of Australian credit card transactions are reportedly now contactless, using MasterCard PayPass or Visa payWave to avoid the need to swipe the card or push it into the chip reader.
Some people seem to think it's easier to wave a phone at the reader (or perhaps that we are more likely to leave our purses or wallets at home than our phones), but the proportion of smartphones with built-in NFC capability is still relatively small - notably, Apple has yet to announce a NFC-enabled phone.
This has led to the development of cases and now stickers with NFC capability to extend the feature to a wider range of phones.