Dubai: Delays by handset manufacturers have postponed etisalat's plans to launch Near Field Communication (NFC) technology, which allows users to make contactless payments using their mobile phones, in the UAE by more than a year, a telecom operator official said.
Rashid Al Abbar, director of M-commerce at etisalat, said yesterday on the sidelines of Telecoms World Middle East that a second pilot would be launched soon to test the technology, with Samsung's new NFC touchscreen smartphone. "The issue has been the handsets… that is the challenge," he said.
In partnership with Emirates NBD, the technology that allows contactless payment involves a handset with NFC capability with a SIM card facilitating data link-up with a credit card. Readers — Visa paywave devices — which will enable such transactions have been distributed to several food and clothing outlets, Al Abbar said.
"We have almost close to 1,000 outlets across the UAE for making the payment…[and] are distributing these phones to close user groups of etisalat and the bank," he said, adding that there is no schedule yet for the commercial introduction of the technology.
"Right now we are testing it [the smartphone] with the bank."
Al Abbar said one of the technologies being tested involved peripherals that would obviate the need for users to buy a new handset to use the technology.
Canadian manufacturer Wireless Dynamics has created iCarte, an NFC/RFID (radio frequency identification) reader for Apple's iPhone that is still in a testing phase.
Samsung's new NFC model underwent trials earlier this year in Spain when Mobile World Congress attendees in Barcelona tested 400 handsets.
After some delays with NFC plans, Finnish manufacturer Nokia has said it will start to introduce NFC into its smartphones in 2011. Other manufacturers working on the project include Korea's LG.
Etisalat's first NFC pilot was meant to be launched about two years ago, when officials expected the service to go commercial by mid-2009.
Al Abbar said that market research has shown a significant demand for mobile commerce.
While rolling out product purchase options from mobile phones, etisalat is also working on mobile banking including bank transfers, but is facing challenges with it, he said.
While the price of the smartphone has not been decided, a push for adoption of the technology might see etisalat subsidise the price.
How it works
NFC is a short-range (approximately 10cm), high-frequency wireless communication technology. The major uses are likely to be in Bluetooth pairing, reading RFID tags, mobile ticketing and mobile payment. Mobile NFC technology operates within a 4cm range with the advantage of a personal identification number (PIN) to make transactions more secure. Payments can be made instantly by waving the mobile phone at a point of sale machine.