FEIG ELECTRONIC: Contactless cards and NFC for public transport ticketing take off

Articles | By FEIG ELECTRONIC | 23 March 2015
Contactless payment and ticketing are growing markets. The new, flexible devices support both. Contactless payment and ticketing are growing markets. The new, flexible devices support both.

Get in and drive off

The market for contactless payment systems is growing. At the same time the range of applications for RFID readers is getting wider, whether for payment with “Tap & Go“ at the vending machines or for credit card-assisted ticketing in public transport. “Ticketing growth is expected, especially in vending,“ says Andreas Löw, Feig Electronic. The reading device manufacturer is preparing for the burgeoning market with a new generation of readers, which support contactless credit cards and NFC applications. Particular attention is being directed at vending applications and open-loop ticketing.

Andreas Löw, Marketing and communication Manager, Feig Electronic, in interview with „RFID im Blick“

Will 2015 be a crucial year for contactless applications?

Maybe not crucial, but the market is definitely growing: in the coming years, almost all smart cards will have a contactless chip. Dual interface will be a minimum requirement. This process will take place very quickly, even for credit cards. A much more decisive year for NFC was 2014. Payment and ticketing with NFC has been around for 15 years. But it is only now that the trend is picking up speed, once Apple, the last player in the market, implemented NFC. The market will now develop slowly, but steadily. I think in Germany there is a wholehearted acceptance about the value of “virtual money“.

„Over the next few years, almost all smart cards will have a contactless chip. This process will take place very quickly, even with credit cards.“

What changes are taking place in the payment sector?

We see, of course, that the demand for payment solutions is there and the market is growing. An important step for Feig this year is undoubtedly that we have established a separate division for ‘payment‘. This was a conscious decision. Payment options are not new for Feig. We already offer various products which support the contactless payment system ‘girogo‘. It was a logical step to outsource our payment products to a separate division to address this specific market even better. But naturally all other segments will be pushed forward with the same energy.

What are the priorities for readers?

One focus in 2015 will clearly be our new equipment series ‘cVEND‘ for contactless payment and ticketing in public transport. There is a definite move towards launching NFC-compatible products to the market this year. So we are introducing a range of products based on our know-how and expertise in contactless technology, which we have built up over decades. Only a few manufacturers have this experience in cashless payment systems. We adapt our knowledge around our new product range, and we think that we can serve the market well.

Will the focus be on vending applications or ticketing?

Our first objective in 2015 focuses on Unattended Payment, so vending and all examples of self-service checkouts. This will encompass payments at petrol service stations, car washes or toll stations. Wherever new systems are retrofitted, there is a need for contactless solutions. Many systems are updated and at this point it makes perfect sense to migrate to contactless systems. These have many advantages in outdoor applications. This renewal process will take place very quickly. In addition, we are talking with manufacturers of the Automated Merchandising System (AMS) for drink and snack machine products. This is a strong and developing market. The other important application is ticketing, especially the use of ticket validators in public transport.

Will this technology be incorporated just as fast in the transport sector?

New technologies will quickly make themselves felt in the ticketing industry. A great deal will be happening in 2015. Public transport companies are preparing for the roll-out of contactless technologies across Europe. In Germany this fits well with the VDV core application. Feig has been working in traditional ticketing for decades. We have now developed a reader module for on-board ticketing in public transport, which is designed for integration into validators or onboard computers in buses and trains. The new element is the contactless credit card that can be used as a ticket to perform check-in and check-out. While ticketing, the payment process is initiated immediately, whereas the payment completion is done later when debiting the account of the user. The OEM module ‘cVEND box‘ is designed for flush-mounting in ticket vending machines, and naturally can also be used for payment applications.

Your view: will the increasing use of NFC develop in parallel with contactless cards?

NFC mobile phone or card – this is no longer a debate. Both are based on the same contactless technology, they just use different mediums. Mobile phones and cards are generally always used in combination. There is now a strong demand for this in the market. It’s important to address the complete market, so we have to accommodate card users in the same way as mobile phone users. So I believe that the market developments will run in parallel. In 2015, there will probably be no noticeable changes for the end user – the market breakthrough for NFC will probably take another two years.

And what about the development of mobile payments: why have the numbers of mobile phone applications not been so high?

There are certainly still some reservations when it comes to safety. To address this, IT-companies must do their homework. Since Apple has now integrated NFC in its smartphones, there is no longer a concern about using it. Nevertheless, the chicken and egg question of which came first, the technology or the application, is still being asked because even large commercial enterprises could revert back to a system of traditional payment. From my point of view, a much greater change will occur when we know who will be chosen to take over the role of the Trust Centre. It may be that massive upheavals will take place.

Last modified on Monday, 23 March 2015 12:31
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