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Customers Tap and Pay in Sao Paulo

The Brazilian pilot, conducted by a large financial company, employs EPC Gen 2 RFID tags in stickers that attach to cell phones.
By Claire Swedberg
Nov 13, 2009One of Brazil's largest financial institutions has been testing the use of RFID-enabled credit cards as part of a project involving EPC Gen 2 passive ultrahigh-frequency (UHF) tags attached to mobile phones. The pilot, believed to be the first of its kind in that country, launched in September of this year and is expected to be completed in December. The system enables customers to make payments for products at four stores in São Paulo, by tapping their phones at a device located at the point of sale. The RFID tags, embedded in adhesive stickers, have been designed to have an extremely short range, operating in what is known as the near field.

The financial company, which asked to remain unnamed, has already provided its customers with more ways to use their account, and to communicate with the firm using their mobile phones. The company provides a short message service (SMS) payment solution for those who wish to use it—a mobile-phone messaging system enabling customers to access account information via a cell phone, or to receive alerts on that phone from the company in the event of, for example, a large withdrawal or purchase from their account.

This fall, the financial group developed the idea to further the use of mobile phones with a contactless credit card handset sticker, in anticipation of the expected growth of cell phones supporting high-frequency (HF) RFID technology that complies with the Near Field Communication (NFC) specifications. The company expects that customers may commonly begin paying for goods and services using an NFC-compliant passive 13.56 MHz RFID chip embedded in the phone by the handset's manufacturer. The firm wanted to offer such a system to customers with a tag that could be attached to the exterior of the phone via an adhesive. The company met with Grupo Gigas, which provides RFID solutions, including readers, integration and software, to manage data from the interrogators, says Bruno Mecchi Gouvêa, Grupo Gigas' director. Grupo Gigas designed a sticker tag, as well as interrogators made with reader ICs from Austriamicrosystems. The tag's manufacturer asked not to be named.

The pilot involves four stores in São Paulo, including a restaurant, a gas station and two convenience stores. Several hundred participants were provided with an RFID sticker containing the company's logo on the front, to use when making payments at the four locations. Participants first filled out a form similar to a standard credit card application, providing their financial information, address and name.

Once approved, a participant can use the tag exactly as he or she would a credit card. Upon making a purchase at the point of sale, that person can tap the tag against the Grupo Gigas reader, which captures the unique ID number encoded to that tag. The device transmits that data to the financial company's server via the Internet, where Grupo Gigas software links that ID number with information in the financial company's records, related to that participant. The amount of the purchase is then recorded on the customer's account, and he or she receives a bill for the sum total of his or her purchases at the end of each 30-day period.

The EPC Gen 2 UHF tags are designed to read only at a range of 10 centimeters (4 inches) or less, Gouvêa says. NFC-compliant tags, in contrast, have passive HF 13.56 MHz RFID chips that support the ISO 14443 A and B standards and FeliCa protocol. EPC Gen 2 technology was chosen, Gouvêa claims, because EPC Gen 2 interrogators cost less than NFC models, such as those that read NXP Semiconductors' Mifare chips, which are based on the ISO 14443A standard.

If the system is well received by merchants and customers, Gouvêa indicates, it will be expanded to other stores and shoppers throughout Brazil, beginning in 2010. Thus far, he says, participants seem to be responding well to the system, and appreciate the faster transactions since they need not take a card out of their wallet and swipe its magnetic stripe at the point of sale.
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