NFC TimesThe premier source for news, analysis and commentary on
Near Field Communication and all contactless technology

Visa is reportedly gearing up to support a “mainstream launch” of NFC mobile payments, along with a cloud-based digital wallet, according to Marc O’Brien, managing director of Visa UK and Ireland.

O’Brien, speaking at the Westminster eForum in London Thursday, said Visa is working with mobile operators Telefónica and Vodafone in the UK, as well as banks and Android device makers, in preparation for mobile-payment launches, reported MarketingWeek. That includes work on security standards for NFC mobile payments, O’Brien was quoted as saying.

UPDATE: “Building momentum from the Olympic Games, we’re looking to roll out more contactless cards as well as mobile-contactless payments this year,” O’Brien said, in an amended quote provided to NFC Times by a Visa spokesman. “We’re also working on a digital wallet for cloud-based e-commerce, called V.me by Visa, and that’s coming here, too, this year.” END UPDATE.

Visa Europe launched a trial for the Olympics in London last summer, with partners Samsung Electronics and Lloyds Banking Group, using Samsung’s popular Galaxy S III smartphone. Telefónica (O2) UK issued the NFC SIMs for the trial, though was not an official partner. 

Both Telefónica and Vodafone groups have concluded deals with Visa Europe to support their planned payment applications in the telcos’ forthcoming NFC-enabled mobile wallets. The telcos say they will also open their NFC SIM cards to banks.

Telefónica’s UK branch, O2, has obtained its e-money license from the UK Financial Services Authority, for its O2 Money service, which would enable it to issue its own prepaid payment application.

But O2 has delayed the launch of NFC at least twice. The telco introduced its long-anticipated O2 Wallet last April, offering text-based money transfers and online product searches and purchasing, but not NFC payment. It said at the time it planned to add NFC later in 2012, but did not hit that deadline. The telco had earlier planned to introduce both the wallet and NFC in 2011.

In a statement last month to NFC Times, an O2 spokesman indicated the time was not yet right for an NFC launch, but that conditions were becoming more favorable.

“As we said at launch, NFC is part of the longer term plan for O2 Wallet,” said the spokesman. “We only launch products and services when the time is right and to meet the needs of our customers. The good news is, we are seeing signs of wider adoption for NFC (contactless payment), for example, TfL’s (Transport for London’s) recent announcement of the payment card standard for London buses, which will help bring the technology to the masses.”  

Visa, in announcing plans Wednesday by a major UK merchant, retail pharmacy chain Boots, to expand its acceptance of contactless payment, predicted the UK will have 34 million contactless Visa-branded cards on issue and 175,000 contactless terminals deployed by the end of 2013.

Mark Austin, Visa Europe’s head of contactless, stated in the release that contactless transactions topped 2.5 million per month in 2012 and predicted a fourfold increase in 2013, fueled in large part by such major retailers as Boots, Marks and Spencer and McDonalds supporting contactless, as well as Transport for London.

The transit authority in December began accepting payment of fares on 8,500 London buses from contactless bank cards.

Transport for London reportedly plans to expand open-loop fare collection to the London Underground and Dockland Light Railway next November.

The launch of the open-loop service on buses had been planned for launch in time for the Olympics, but was delayed, with the authority citing complexities in rolling out the service. Accepting bank cards directly to pay fares on the fast-paced Underground, or Tube, is even more complex, so delays are likely.

Meanwhile, like O2 UK, Vodafone’s NFC plans have also been delayed.

Vodafone announced in February of 2012 plans to introduce a Vodafone-branded NFC prepaid payment service in at least five of the group’s European branches, Germany, Turkey, the UK, the Netherlands and Spain, over the following 12 months, in the biggest announcement of its kind from a major operator group. It has not yet launched NFC in any of the markets.

Another Vodafone branch, Vodafone Italia, has announced plans for an NFC launch this year, featuring its own branded payment application. The branch has a separate deal with MasterCard Worldwide to help it roll out payment.

Telefónica and Vodafone rival Orange launched NFC commercial service in the UK along with issuer Barclaycard in May 2011, using a MasterCard PayPass application. The launch, however, turned out to be only a token project and remains very small.