Should Your Business Be Using NFC Payments?

NFC Payment India
(Last Updated On: October 11, 2021)

Did you know you could make payments by just bringing your phone near a PoS machine? NFC Payments or Near Field Communication payments make this possible. Here, is all you need to know about NFC payments and if your business should use it.

What are NFC Payments?

NFC (Near-Field-Communication) is a technology that allows two devices (a phone and the Point of Sale machine) to communicate with each other by sending small amounts of encrypted data. This enables contactless payments.

Many big retailers in India like Big Bazaar and Dominos use the NFC technology at their outlets. Visa issued over a million NFC cards and has more than 100,000 merchants enrolled in the NFC program.

How do NFC payments work?

NFC  is a subset of RFID (Radio Frequency Identification). It uses a particular frequency (13.56 Hz) for close-range communications. You can just hold or tap a mobile device at a Point of Sale machine and your payment will be done. You don’t even need to enter an OTP or PIN Number!

To understand how NFC payments work, let’s use the example of Apple Pay. Available to Apple users, they use a technology called tokenization, to help safeguard your card details. All you need to do is, download the app and upload a picture of your card.

Once that’s done, your bank is contacted and they replace your bank details with a series of randomly generated numbers. These numbers are then sent to your phone, where they are programmed into your phone. This process happens for every transaction, thereby providing a unique series of numbers for each transaction.

What do you need for communication payments?

You will need:
  • A payment app like Samsung Pay, Android Pay, Apple Pay, or ICICI Pockets.
  • A debit or credit card which supports NFC payments
  • A smartphone that supports NFC payments.

Accepting NFC payments as a seller:

All you need to accept payments is an NFC-enabled payments reader or a POS (Point-of-Sale) terminal. With this, customers need to only keep their smartphones within a 20 cm range, to allow for cashless payments.

NFC-enabled readers cost anywhere between Rs.4000 and Rs.10,000.

Are NFC payments secure?

The NFC Payments are considered to be safer than magnetic-stripe cards. Cards have embedded information that never changes. It’s easy for anyone to clone and misuse cards. In case of NFC payments, they are all dynamic and encrypted. They are also:

  • Faster: Unlike the conventional methods, NFC transactions eliminate the need for human intervention. Hence, transactions happen in a matter of seconds.
  • Convenient: Eliminating cash, cards and manpower, makes it an easy and convenient option.

Should you choose NFC payments?

While NFC payments may sound like the future and the most secure way of payments, there are some problems that may make you reconsider. There is no two-factor authentication of payments, which still makes it vulnerable to hacks. What’s more? They are great for a physical goods seller.

If you are selling online, NFC payments may not help at all.

Instamojo is the safest way to collect payments online.  Just share your payment link on SMS, Email, Whatsapp, Facebook, Website, and more, and never miss a payment! Also allow your customers to pay via Credit/Debit Cards, Wallets, Net Banking, UPI & EMI, and even QR Codes.


    1. No, we don’t.
      But you can accept online payments with Instamojo and even convert your payment links into QR codes.
      Let us know if you need any help with setting up.

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