Jan 19, 2020Near Field Communication (NFC) is a revolutionary concept that has brought several promising opportunities. NFC is an array of protocols based on a wireless interface that enables devices to communicate in order to establish radio communication within proximity of each other. The technology has gained popularity since it offers the easiest way to connect smartphones, laptops and tablets for short-range data exchange. Moreover, major companies such as Google, PayPal and MasterCard have invested a huge pile of money into the realm of the NFC market.
According to research firm Allied Market Research, the global NFC market is projected to garner $24 billion by 2020, registering a CAGR of 40.4 percent from 2015 to 2020. Increasing inclination toward the convenient transfer and security of data, a rise in smartphone penetration and the prevalence of contactless payments have boosted the market growth. These days, NFC has become mainstream—it's the reason why a number of smart devices are seamlessly connected and able to work in the background.
What Is NFC?
NFC allows smart devices such as phones, tablets and laptops to share data with other NFC-equipped devices. It is the next advancement in radio frequency identification (RFID) technology. The security scan cards that employees use have RFID technology. NFC finds similarity with RFID, but it is limited to within about 4 inches.
Many believe the small radius of NFC is one of its drawbacks, but on the contrary, it is one of the major reasons why NFC has offered the most secure alternative to credit cards. Apart from the transaction of money, NFC can be used to transfer videos, contact information and more between two NFC-enabled devices. Moreover, NFC is one step ahead of Bluetooth; it does not require manual pairing every time data is transferred. Once two NFC-enabled devices are within each other's radius, they can automatically communicate with each other and send prompts to users.
Major Trends in NFC
NFC incorporates inductive-coupling technology, by which data and power are shared through coupled inductive circuits within a limited proximity. It is often employed through credit cards or mobile phones so that the information can be read when shared from closely located NFC devices or tags. The most appreciated application of NFC is a contactless payment system. People can make payments by just swiping at an NFC reader. The NFC device transfers the information regarding the user's credit card and, since the transactions occur within a short range, it is considered secure. With the increasing popularity of NFC in mind, here are some of the major trends in the Near Field Communication market.
Surge in NFC-based Transactions: NFC is being used for a variety of purposes. From programming your workout to controlling Wi-Fi, NFC has gained popularity in every sector. Moreover, NFC has become the focal point for several financial transactions, and NFC-based applications have gained traction in the BFSI and retail sectors. What's more, Google's tap-and-pay initiative has gathered various participants, including Citi Group, MasterCard and Verifone Systems.
Increase in Market Vendors: An increase in the number of vendors was inevitable after the surge in demand for NFC technology, which has had a positive impact on the market. The smart cards shared for several applications, including transport, loyalties and libraries, have guaranteed a strong and loyal customer base. Thus, the rising number of vendors would compel the advancement of NFC infrastructure, which in turn propels the growth of the market.
Advent of Mobile Wallets: The introduction of mobile wallets has allowed users to pay for various services using their mobile devices as credit or debit cards. These electronic wallets store information about customers' debit cards and enable them to pay at NFC-enabled terminals using their smartphones. However, a user must have high-speed internet connections and interoperability between issuers and service providers. Thus, mobile wallets are gaining popularity since they offer the most effective and easiest way of carrying out online transactions.
Personalization in Automotive Settings: The most innovative application of NFC is in the automotive sector, where it can be used for the personalization of settings, such as FM radio channels and air conditioner regulation. Apart from this, NFC tags can be used for authenticating automotive spare parts. Moreover, NFC tags can be embedded with appropriate maintenance or breakdown instructions.
Another potential use of NFC technology is in visitor badges for conferences and meetings. These badges can offer information about a conference, as well as contextual conference materials, and can provide live updates via social media. It is believed that RFID and NFC are all set to bring a revolution in every sector of our lives—and we'd better be ready for it.
Swamini Kulkarni holds a bachelor's degree in instrumentation and control engineering from Pune University, and she works as a content writer. Swamini is deeply fascinated by the impact of technology on human life and loves to talk about science and mythology. When she is not glued to the computer, she loves to read, travel and spend time thinking how she could read and travel more often.