The future for credit cards could soon change. A new system is now in place allowing any mobile phone to be turned into a “tap and go” credit card.
The system allows purchases to be made of up to $20, and could potentially mean the end of small cash payments within five to ten years, states advocates. It operates by using a smart card or PayTag, which is about a third of the size of a normal credit card. The PayTag is inserted into the back of the handset.
The phone is then tapped into a specially adapted till. The tag, containing a microchip, communicates with the till terminal via an antenna to confirm the customer’s credit card account. A payment is then authorized without the need to enter a PIN.
The system is being launched by Barclaycard Consumer Europe. Barclaycard states the system has a 100 percent fraud protection and is likely to be adopted by other major banks. The new tag means any phone can be used to tap and go payments. Previously, only a few hi-tech handsets could be used to make these payments.
Retailers are catching on to this new trend. Tap and go tills are being introduced at Waitrose, McDonald’s, Boots and Tesco in Europe. The hopes are for this system to be up and of use with London buses by the end of this year.
“More than half of us say that the item we’re most lost without is our mobile phone, so we’re giving people the option of using them to make easy, convenient, everyday payments,” states David Chan, the chief executive of Barclaycard Consumer Europe.
Others, like Carl Scheible, the managing direct of PayPal UK, echoed this thought. Scheible said, “By 2016, you’ll be able to leave your wallet at home and use your mobile phone as the 21st century digital wallet.”