Are there limits to NFC and mobile payments?

As a regular follower, you’ll have read a post on the rise of eBanking and mobile payments in the USA. You might also have crossed the Atlantic (via social media) to see for yourself whether London is NFC-ready with our Contactless Challenge – encouraging two mobile influencers to compete to complete several NFC tasks with only a smartphone. (If you haven’t, I recommend following #GemaltoNFC for some interesting and amusing anecdotes of NFC in and around London.)

Much is made in the media of the allure of NFC technology, promising a better (and faster) customer experience, removing barriers to payments and so on. However, doubts still remain.

One question I received via LinkedIn was the following, from A K Hall:

Please clarify or inform…? Can you make a purchase via NFC for more than twenty dollars? Or is that a current restriction to be eventually raised?

This is a very interesting issue to raise, as it is these types of doubts that lead consumers to avoid trying to use their contactless device to make a purchase, and instead resort to old-fashioned cash.

The quick answer is that, with NFC and an associated wallet application, you can spend up to your credit limit. When NFC was first introduced there were limits placed on the amount of a transaction, which, as correctly pointed out, was typically not to exceed $20 per transaction. With the introduction of mobile wallets and payment services like Isis which was recently launched in Austin and Salt Lake City, NFC in any form factor simply becomes another payment product. To pay with NFC in any form factor is only limited to the amount of available money or credit associated with the account holder.

So there we have it. Hopefully that’s cleared up some confusion and will encourage more consumers to explore NFC opportunities.  Let me know if you have any other questions on NFC so I can demystify the technology for you.