Are credit cards becoming obsolete?

Technically Speaking

Would you feel comfortable ditching those credit cards and using your smartphone to pay for your in-store purchases? For several years now there have been news articles that discussed the coming use of smartphones to pay for in-store purchases, but until now, it has never really materialized. With a new technology called Near Field Communication, this payment option has finally become possible in an easy and secure way.

NFC: What is it?

NFC technology has created a secure way to transfer your personal information. In the past, other technologies available for payment data transfers (wireless, Bluetooth) were looked on with suspicion because their range was too long – sometimes up to 30 feet. Many didn’t trust the security of these methods, believing that hackers could get at their personal information.

Now with NFC, the range is down to mere centimeters – meaning you have to practically touch your phone to the reading device to pass the payment information. The data is still secure and encoded, but the chance of someone casually swiping your information has been greatly reduced. Many smartphones now have a chip in them to enable NFC with apps on the phone to provide the security and programming to send the information.

Who are the players?

Google was one of the first companies to make use of this new technology. They created an app called Google Wallet for the android based smartphones that can store your credit and debit card information. In stores like CVS Pharmacy and Radio Shack and Sunoco gas stations all you have to do is step up to a NFC compatible checkout and you can use the information in your Google Wallet to pay for your purchase. (See the Google Wallet website for a list of additional stores that accepts the Google Wallet at google.com/wallet/how-it-works/in-store.html.)

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