Vodafone has begun Australian trials of SmartPass, payment application for Android phones which support Near Field Communication (NFC), creating yet another method by which we can make payments simply by tapping our phones on an appropriate reader. That could be very convenient, but the plan isn't without its challenges.
This isn't the first payment mechanism we've seen via NFC. The most prominent local example is the Commonwealth Bank's Kaching application, although oddly the bank only supports it on iPhones (which need a special NFC-enabled case) and ignores Android (despite NFC-enabled Android phones being increasingly common). Globally, Google Wallet is the most visible NFC success story, but it isn't yet available in Australia.
The SmartPass app is currently being trialled by 101 customers around Australia. Once that process is finished, Vodafone plans to roll it out to customers in early 2013, though it hasn't set an exact launch date.
The basics are like any other NFC system: With the app installed and running, you can use an NFC-equipped phone by placing your phone within a centimetre of any existing payWave terminal. If you want to pay more than $100, you also need to enter a PIN on the payWave device. The payment comes from a specific Visa prepaid account set up for use with the service. You can't put more than $1000 credit on that card — a move presumably designed to minimise the risk if someone misplaces their phone and doesn't take sensible security precautions.
The process is driven by an Android app on your phone, which also lets you check your balance and transfer funds as needed. There's some clever design tricks in the app; rather than displaying your balance for all to see when the app is open, you have to use a slider to reveal it. That ensures a nosey shop assistant can't see how much cash you have left.
The big issue with the app is that it will only work for Vodafone customers, which is a shrinking group of people in Australia these days. Vodafone eventually plans to offer the app pre-installed on all new Android phones with NFC capabilities that it sells. Existing customers will also be able to install the app, though they'll also need to swap their SIM for a specific NFC-enabled one.
That aside, the element I'm not entirely keen on is the separate card. While I appreciate that minimises the security issues, having one more card set up seems less convenient than using the accounts I already possess. What do you think?
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