Barclaycard PayTag Turns Ordinary Mobiles Into NFC Wallets

Barclaycard has come up with an innovative way to transform a humble mobile phone into a device capable of making contactless NFC (near field communication) payments – a sticky label called the Barclaycard PayTag.

A PayTag label, stuck to the back of a humble mobile phone, will let Barclaycard customers make NFC micropayments, without the need to upgrade to the latest smartphone that boasts an embedded NFC chip.

No Phone Upgrade

The label is available at no cost and exclusively to Barclaycard Visa cardholders, and will simply act as an extension to the user’s existing credit card account.

The PayTag mobile will work by being held over a contactless payment terminal, allowing users to initially make payments of £15, but from June this will rise to £20.

“Today, we are offering the choice of mobile payments to millions of our customers at no additional cost to them,” said David Chan, CEO of Barclaycard Consumer Europe. “More than half of us say that the item we’re most lost without is our mobile phone, so we’re giving people the option of using them to make easy, convenient, everyday payments without the need to upgrade their current handset.”

The announcement comes as Visa predicts that the number of contactless point-of-sale terminals in the UK will rise by 50 percent to 150,000 this year. Barclaycard said that retailers that currently offer, or will soon offer contactless payment methods include the likes of Waitrose, McDonalds, Boots, WH Smith and Tesco. And by the end of the year the scheme will also be rolled out into London buses, followed by the Tube network thereafter in 2013.

Security Concerns

Barclays sought to reassure customers over the security of the new PayTag, saying that it comes with the same 100 percent fraud protection as any Barclaycard.

This comes after a Channel 4 investigation last month warned that up to 13 million users of Barclays’ contactless debit and credit cards could be defrauded using NFC-enabled smartphones. That investigation found that smartphones integrated with NFC technology could be adapted to collect sensitive data from cards with just a quick swipe.

In February PayPal hit out at NFC technology at the Mobile World Congress in Barcelona, saying that point-of-sales terminals will be obsolete in retail by the time that the technology achieves mass adoption.

And in October last year, a survey revealed that Britons remain sceptical about the potential security risks of NFC. That Intersperience research found that 44 percent worry about the lack of security software on mobile phones, and only 17 percent of consumers want to use mobiles as wallets in future.

But Barclaycard remains convinced that users will be opt for the increased flexibility that the  PayTag will offer.

“Barclaycard is developing a wide range of initiatives which will ultimately enable everyone to enjoy the benefits of mobile payments,” said Barclaycard’s Chan. “Barclaycard PayTag is another milestone on our journey to make paying easier, and sits alongside other easy ways to pay with your mobile such as those we offer in partnership with Orange.”

Barclays and Visa have so far pioneered contactless payments in the UK, having already installed terminals in 56,000 locations such as the O2 in London. The pair has also announced plans to issue smartphones with NFC technology to Olympic athletes as part of the pair’s contactless payments push in the UK.

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