The European Payments Council (EPC) has published a white paper which examines the ways in which NFC technology could be used to deliver compatible mobile phone-based payments services across the 32 countries of the Single Euro Payments Area (SEPA).
As well as the way in which near field communication technology can be used to deliver mobile versions of existing card-based payments services, the White Paper on Mobile Payments also highlights the potential of NFC to enable consumers to use the secure element in their NFC phone to directly transfer funds from their bank account to a merchant or other supplier — potentially reducing the cost to merchants of handling electronic payments.
“Many consumers are already using mobile phones for services beyond the traditional voice calls and short messaging services due to the introduction of packaged offers, including internet access provided by the mobile network operators,” says the European Payments Council. “As a result, consumer expectations with regard to mobile phone functionality have increased dramatically, with many users eager to embrace new service solutions based on this delivery platform, such as payments. The availability of practical SEPA mobile payments, either account or card-based, would provide a realistic alternative to cash and cheques.”
“At the same time, merchants demand that new technology translates into cost savings, increased business volume and reduced exposure to security threats such as cash thefts or illicit payments, as well as enhanced marketing opportunities and brand recognition,” it continues. “Mobile phone initiated payments, in particular those using the contactless approach, are very well positioned to generate these benefits for merchants and other stakeholders who are directly providing services to consumers.”
The European Payments Council is working with a number of organisations, include mobile network operators’ association the GSMA, to set standards and business roles for mobile payments in Euro countries. “The aim is to develop proposals that support collaboration and standardisation and which form the basis for interoperability,” says Gerard Hartsink, the EPC’s chairman. “Our intention is to establish a service framework sufficient to reach potentially all payers and payees in the European Economic Area and to create a trusted and secure environment for the multiple stakeholders active in the field.”
The EPC’s mobile payments initiative is headed by DnB Nor‘s Dag-Inge Flatraaker, who explains that “the EPC White Paper on Mobile Payments responds to changing customer requirements in the payments market and demonstrates how mobile payments can increase efficiency, effectiveness and convenience. This paper creates awareness on how to best combine the benefits of state-of-the art SEPA payment instruments for credit transfers, direct debits and card payments handled through one of the most popular and versatile devices introduced in the past two decades — the mobile phone.”