Can NFC help SMBs?
Near-field-communication or NFC has taken much of the spotlight in the retail industry. It is one of the newer gadgets that gets every technology enthusiast excited and talking. Its applications for converting your phone into a digital wallet is impressive in the least. While thought leaders and experts anticipate NFC to become the next industry standard, there are a few reasons why some remain skeptical over its hype.
What is NFC?
NFC refers to a set of standards that allow data to be transferred from one device to another either by touching them or putting them close together. It behaves similarly to infrared technology, but establishes radio communication like the one used in the shipping industry to update inventory status, as well as in supermarkets.
While NFC sounds something of a James Bond gadget, it has its uses. Firstly, NFC has significant application for the retail industry, helping customers shop conveniently from the comfort of their smartphones. Imagine how satisfying the shopping experience would be for your customers when all they have to do to purchase their favorite items is by keeping their phone within a feet’s distance of the other device.
“NFC is the one Holy Grail-like technology most likely to make the long-held promise of the electronic wallet a reality. Companies in all sectors, including retailers, financial services organizations and mobile carriers, are all salivating at the prospect of NFC-enabled smartphones that make paying for something as quick and easy as sending a text message.”
- Carmi Levy, a technology analyst in London, Ontario
Having said that, there is, at the moment, only a limited number of shoppers who would be tempted to shop using NFC. Much of the details and uses for retailers are only limited to US and even within that, only a small number of individuals would express any great desire to shop with their smartphones.
One explanation of this would be the initial stages of NFC in the consumer world. It can take up to multiple years and even decades for NFC technology to become widespread. However, industry experts are not so keen that might be the case due to the number of security risks it can pose for businesses.
Regardless of the kind of encryption consumers install on their smartphones, there is still an immense risk of someone stealing the phone and access confidential data. If the consumer has saved all of his credit card and bank account details on the phone, then it can be acquired very easily.
Data manipulation and corruption
A third party can also manipulate the data being sent to your smartphone so that it becomes of no value by the time it appears on your smartphone screen.
NFC can also allow a third party to eavesdrop on an NFC transaction and acquire sensitive information easily. The security of the NFC channel is of paramount concern. If you, as a retailer or other business, do use channels that are not properly secured, then chances are that your customers can face data breaches, costing them a lot of money.
While NFC shows potential for SMB use, there are a lot more security concerns that need to be addressed to avoid any loss of business integrity and customer loyalty. Cybercriminals seems to be one step ahead in finding loopholes in new technology for their own purposes. Therefore, until businesses can ensure their NFC channels, customers will not have confidence in using such technology for their shopping purposes.