Spain: Country's Largest Telco Plans Big Payment Trial

 

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SitgesSpain
Scope: 
Trial
Launch: 
May 2010
Main Application: 
Payment
Mobile Operator: 
Telefónica
Service Provider (application): 
La Caixa (Visa payWave)
Merchants: 
500
Users: 
1,500
NFC Handsets: 
Samsung S5230 Star
TSM*: 
Telefónica
Secure Element: 
SIM
Other Vendors: 
Gemalto (SIM card), Giesecke & Devrient (SIM card for MWC demo), NXP Semiconductors (NFC phone chip)

The planned six-month “Mobile Shopping” trial is set to enable 1,500 customers of Telefónica and La Caixa bank to tap to pay at 500 shops in the resort town of Sitges near Barcelona. Plans call for distributing a large number of NFC phones supporting the payment application on the telco’s SIM cards. Telefónica also designed what it called a graphically appealing mobile wallet for the trial. Telefónica, La Caixa and Visa launched a preview of the trial at the Mobile World Congress, demonstrating the payment service by issuing 400-500 Samsung handsets to attendees, who can tap to pay at more than 30 merchants equipped to accept Visa payWave around the congress center. The telco also plans a large internal trial at its headquarters in Spain.

NFC Times Take: 

Telefónica Spain is getting more deeply involved in NFC with this large trial. The telco has been an early backer of NFC and of using the SIM cards to store applications. Sure enough, this trial uses a new Samsung phone that can carry the planned Visa payment application on the SIM with a standard single-wire protocol connection to the NFC chip in the phone. The trial will probably use Samsung’s new S5230 Player One touch-screen NFC model, which will also be tried out by French operators for an even larger project scheduled to launch this spring. Telefónica will also serve as TSM, handling the downloads and management of the application on the SIMs. Users will be able to view the application and related information and features from a mobile wallet the telco provides. It’s not clear whether that user interface will also be stored on the SIM. Telefónica also plans a large internal trial during Q2 of 2010 at its headquarters, with both open-loop and close-loop payment, metro ticketing, and access control.

 

* Trusted Service Manager: Defined loosely to include companies or other organizations securely distributing, provisioning and managing applications, generally over the air, on secure elements in NFC mobile phones; or licensing their platforms for this purpose.

N/A: Not available or not applicable.
Results: 

The bank said that during the first month of the pilot at least 60% of 1,500 users had conducted at least one transaction at any of 500 merchants accepting Visa payWave in the town. Customers conducted an average of three transactions apiece, according to the bank, which said that about 60% of transactions were under 20€ (US$27.80). Just over 50% of customers tapped their phones for purchases at supermarkets, while restaurants accounted for 14% of transactions. The parties said customers conducted 30% more transactions, presumably than compared with their cards. Average purchase value reportedly increased, as well. And "acceptance of the technology by all groups" with the average age of customers using their mobile phones to pay surveyed at 46.

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