By Claire Reilly

Visa and Vodafone have announced a new NFC-based payment initiative that builds on the popularity of the Visa payWave system and brings cashless payments to smartphones. As with Visa payWave – the widely established credit card-based system – Vodafone SmartPass allows users to touch their device to a receiver and make a payment in seconds, potentially revolutionising the way retailers process sales.

Vodafone SmartPass is an app available to all smartphones on the Vodafone network equipped with Near Field Communication (NFC) capability. With the purchase of an NFC-SIM card from Vodafone, the free app allows users to top up a virtual, cloud-based account from any Visa or MasterCard, before making payments and reviewing purchases on their phone.

In terms of retail penetration, the technology utilises existing payWave receiver terminals which are currently installed in more than 100,000 locations across Australia, according to Visa’s director of innovation and emerging products, ANZ, Ben Pfisterer. This includes mainstream retailers, such as JB Hi-Fi, Woolworths, Coles, 7-Eleven and McDonalds.

Pfisterer said that one of the key factors in ensuring the success of the new interface was simplicity.

“We’re very keen to make sure that any consumer that picks this up from a Vodafone store knows how to use it very quickly, and can enjoy using it in the retail environment,” he said. “The screen design is very intuitive and very clean.”

As far as uptake of the new cashless payment technology is concerned, Pfisterer cited Visa’s previous successes with the payWave system as well as the growing popularity of NFC in smartphone devices.

“The proliferation of NFC is going to be key,” he said. “Look at what has happened with payWave. Last month we saw 40 per cent growth in payWave transactions and we’ve seen over 25 per cent growth for over a year, month-on-month. That’s phenomenal utilisation. Australia is now the biggest payWave utiliser in the world, so consumers are trying it, they’re loving it and they’re coming back and using it.

“The exciting thing is that when I use it, nine times out of ten I get stopped by the merchant who says, ‘Oh my goodness, what was that? Where do I get it from?’”

Pfisterer conceded that although the technology may take time for consumers to get used to, it would soon lead to a reduction in payment queues at retail checkouts, with individual transaction times varying depending on payment amount (sales over $100 require a pin) and the user’s security settings.

“The whole idea is to cut the queues – without that, there is no value to the merchants,” he said. “So you tap the screen, and you go. Transactions can be conducted as fast as less than one second, and some of the top-end transactions may be up to four or five seconds. So they’re very, very quick transactions.”

This article first appeared on