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Retail Group Opts Out of NFC for Mobile Payments

Some prominent mobile wallets today rely on NFC as the primary method of making payments. These include the mobile carriers' Isis venture and Google's mobile wallet. Others, such as PayPal, consider NFC optional. The mega-retailers' Merchant Customer Exchange (MCX) venture, which has yet to release a product, promises a software-based alternative to NFC, storing card data in the cloud and using bar codes to conduct transactions.

MCX will start with a cloud-based wallet that uses bar codes, says Dodd Roberts, an executive with the MCX venture. He argued that NFC-equipped phones aren't widespread enough for the standard to gain traction right now.

"Bar code is a technology that any smartphone and that most merchants can handle today," he said.

"MCX wants consumers to be able to use the smartphone they have today," he said. However, he added that "we will definitely build it so that as technology evolves, no matter how long it takes, we will be able to shift as necessary."

Regardless of their approach, each company is pushing to make its system ubiquitous as fast as the underlying technology will allow it.

For Donald Kingsborough, PayPal's vice president of retail and prepaid products, ubiquity means the vast number of online — and now increasingly, physical — merchants that accept PayPal, while Isis Chief Sales Officer Jim Stapleton points to the more than 20 NFC-equipped smartphones that now support the mobile carriers' wallet.


Echoing the sentiment of PayPal President David Marcus — who wrote in a December blog post that "the NFC payments debate will slowly die in 2013" — Kingsborough said many retailers don't want to invest in NFC because they don't trust that it will become a long-lasting standard like magstripe cards, making it difficult for NFC to take hold in consumers' everyday life.

"It's only when they don't have to think about where they have to go to use your product that they've integrated it into your everyday life," he said.
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