Friday, September 27, 2013

Why NFC in Canada is a joke


Today I spotted something in the news that proclaimed NFC was going to get hammered by Apple's iBeacon and Paypal's BLE payment system.

For me, this is a good thing.  I like technology, but in Canada we always see a good thing get ripped apart and shredded into "camps" and as a consumer, you're forced to be in one or the other.  Anything in Canada with NFC ("Near Field Communications" - sometimes jokingly known in trade rags like the Register as "pay by bonk") as the major component is likely to subjected to this type of degradation of usefulness.  

The usual unholy alliances and arbitrary alienation of huge chunks of customers means that nothing ever becomes a standard.  We saw it with NFC payments and Credit Cards.  "Oh, you have a VISA Paywave card? Sorry, we only accept have MasterCard Paypass".  

We also saw it when Rogers and CIBC teamed up to provide mobile payments - oh, you have ScotiaBank, TD, or RBC bank account?  No mobile payments for you.  Just as bad, if you were a Bell wireless customer with a CIBC account, you still didn't have NFC mobile payments, which begged the question as to why CIBC was even mentioned in this fiasco as it's obviously not a banking payment app, but just another way for Rogers to add line items to it's bills.

Then there was the Presto system.  Yes, here's an NFC system for the masses, right?  No. You can't load up the Presto card with $100, then on your evening commute think "I'll just swing by the shop and pick up a pint of milk" and hope to use this NFC card as payment, because (again) it's walled off (in the trade, known as "a closed-loop" system).  

As you can see, this is all a load of arbitrary crap designed to protect the stakeholders of the entity that's taking the money.  

It's got nothing to do with the customer being able to "efficiently and effortlessly" pay for the things they need.  If it was, you'd be able to wave your MasterCard Paypass card over a Presto sensor to pay for your fare.  No, instead we have to parcel our cash out into little piles… one bit gets loaded onto the Presto card, one bit gets left in the bank to pay Rogers for the groceries I bought in some places…. one bit gets left in the bank to pay for the VISA PayWave bill….  etc, etc.

The comical thing about this is having walled off these little camps, someone one day will have a bright idea of uniting them under some third party so you have one card that can be used anywhere!  After all, how do you think we ended up with Interac in the debit card space? 

Finally, there's the icing on the cake:  It's a well studied and reported fact that Android users spend far less money than Apple users.  Now take a wild, stab-in-the-dark guess at which one doesn't have NFC chips in their phones anyway?

The sooner we abandon it and adopt a scheme that actually works for a sizeable majority of people, the better it will be for the customers - because Q.E.D, the status quo is not in the customer's favour.