Thanks to the growing popularity of online payment systems like Android Pay and Samsung Pay, NFC is becoming pretty commonplace, particularly when it comes to high-end and some mid-range devices. What is NFC exactly, and how does it work in mobile tech? This article answers these questions and more.

According to Investopedia, near-field communication is a wireless technology that lets people make payments by positioning a compatible device like a payment card or smartphone within a few inches of another compatible device like a tablet, terminal, or another smartphone. Near-field communication devices transmit data through electromagnetic radio fields. Payment services like Apple Pay and Google Wallet work based on this technology. For an NFC transaction to take place, both devices must contain NFC chips.

Fast and Simple Payment

Near-field communication makes the payment process faster and simpler. This technology makes it possible for usersto carry a smartphone that can serve as a virtual wallet instead of having to carry around both a phone and a wallet. To make payment, you wave one device or tap two devices together. NFC increases the safety of payment transactions. With it, retailers don’t need to check identification by requiring biometric data like a fingerprint. The technology on this level also providesenhanced safety against credit card theft.

NFC may be best-known for letting consumers pay retailers and each other with smartphones, but that’s far from its only use. It has also been integrated intosubway cards and credit cards that you can wave over card readers, as well as in household appliances, speakers, and other electronic devices that can be controlled and monitored via smartphones.

NFC technology entered the mass market about eight years ago when Google Wallet was introduced. It became even more popular with the introduction of Apple Pay in 2014.

Limitations of NFC

At present, buyers usually still need to carry cash or credit cards because not all retailers have the equipment to process payments through NFC. Even after the technology becomes universally accessible, users may still need to have a backup payment method available because you can’t make payment through a device,the battery of which has died.

Current Uses of NFC

NFC chips integrated in credit cards to enable contactless payments are by no means new. Most recently, it has become possible to use NFC with a smartphone or smartwatch to render your wallet fully digital.