Telstra, National Australia Bank and Visa have joined forces to test out near field communications (NFC) -- a technology which allows users to pay for goods by placing their mobile phone on a reader.
The NFC trial will take place in Melbourne at the start of next year, with around 250 users who are customers of Visa, Telstra and NAB. The guinea pigs will be given a smartphone with NFC capability and be able to make small purchases using the handset in about 30 retail outlets that will be equipped with NFC readers.
A spokesperson for NAB said the experiment will likely involve a number of the bank's employees but members of the public will also be invited to join the pilot.
The threesome are in discussions with retailers over the trial. No names have yet been announced but a Telstra spokesperson said previous NFC trials around the world have used fast food restaurants, cinemas and petrol stations -- a pattern that is likely to be repeated in Australia.
NAB executive general manager for retail banking, Andrew Thorburn, said the trial will include both phone and NFC-enabled credit cards.
"In the future, we expect it will be able to be linked to your everyday EFTPOS card as well, making it even more convenient," he added.
Should the pilot prove satisfactory, it's thought a commercial deployment could go ahead within the next couple of years.
With NFC, purchases made by swiping the phone against a reader are typically restricted to a low dollar value for security reasons. In the Australian trial, such purchases will be restricted to AU$30 although customers will be able to spend more if they authenticate the transaction using their PIN number.
Such contactless payment technology on phones and credit cards is already proving popular in Asia, where Sony's Felica NFC system is used by operators including the Japanese giant NTT DoCoMo.
DoCoMo sells "osaifu keitei" or wallet phones, with NFC functionality embedded. Around 20 million of the devices have been shipped and 200 million NFC chips have been shipped around the country, mostly on smartcards. Anyone with a "wallet phone" can use it as a credit card after DoCoMo launched its own card brand.
In Europe, however, the technology has been slow to get started and remains largely in the pilot phase in most countries where it has been deployed. One notable exception is the UK's Oyster card, a contactless system used as ticketing and payment for the London Underground. Trials began earlier this year to add credit and debit card functionality to the contactless card.
According to industry analysts ABI Research, by 2012 around 292 million handsets or just over 20 percent of the global mobile handset market will come with built-in NFC capability.
Via ZDNet Australia