POS (Point of Sale) payment is one of the categories of mobile payment ecosystem. It is also known as tap-to-pay as the user just taps his device on the terminal to make the payment.
User stores his card details in his smartphone (or any compatible wearable). Instead of swiping the card, user can just tap the phone on the terminal. The device then requests for user authentication via fingerprint to confirm payment.
Tap-to-pay system uses NFC (Near field Communication) technology that allows two devices placed within a few centimetres of each other to exchange data. In order for this to work, both devices must be equipped with an NFC chip. So, when user taps the device on the payment, the NFC-powered terminal subtracts money from the balance written to the card.
Apart from making payment, now mobile payment can also allow you to withdraw cash from ATM. From end of 2016, Bank of America has services allowing the customers to withdraw cash from the user’s bank account by simply tapping their NFC device.
According to nfcworld.com “value of transactions conducted via NFC handsets will grow from US$30bn in 2016 to US$45bn in 2017, US$70bn in 2018, US$110bn in 2019, US$160bn in 2020 and US$240bn in 2021”
Major players: Apple Pay, Android Pay and Samsung Pay
More than 100m people will make an NFC mobile payment in 2016