QR, AFCS and NFC - An exciting Ménage à Trois
The large-scale rollout of NFC terminals in the wake of QR acceptance, paired with the ubiquitous cross-border acceptance of EMV payment cards and the eminent suitability of contactless EMV for mass transit account-based ticketing, has put QR payment systems on the backfoot.
Just when we thought traditional payment cards have lost the race, they are rapidly eating into the QR payment lead.
The solutions are clear to me. QR payment systems must come together and build a cross-border system that deserves its name, and they have to transition to the NFC interface of the mobile phones[1] for mutual authentication.
One might ask why bother with some NFC-QR contraption when we already have EMV, which is proven and works globally. My answer would be that it would indeed be a waste of time if NFC-QR simply mimics the EMV-based payment schemes.
But if the QR payment providers remember that there is more to QR payment than just the mobile phone camera and a checkerboard of ones and zeros, NFC-QR can be more than an imitation of EMV.
In fact, when you add authentication and mutual data exchange at the point of interaction, you will find that many things are possible that would require cost-prohibitive changes to traditional payment schemes.
One such option would be a sender-centric QR-NFC system. In my article I am outlining such a system using the example of account-based automated fare collection.
QR Payments - Innovate, don't imitate!
Instead of innovating payments, the new breed of QR/A2A payment schemes too often think of their system as a “primitive” form of card payments. Or, they treat payment merely as an enabler for their ambition of becoming a virtual bank. There is too much data, too much functionality and not enough effort to make the payment process better.
In this post, I want to make the case for removing data from QR payments.
In my view, the principles of any new payment system should be: “Payment moves money efficiently, anonymously and conveniently (for the customer). Use of account information is kept to a minimum. There should be no personal data.”