Popular Chinese Smartphone Maker Incorporates Embedded Secure Element

France-based Oberthur Technologies has announced its embedded secure element is included in the newest Android handset, the Mi3, from China’s popular smartphone maker Xiaomi, and predicted the chip will enable NFC mobile payment in China.

Oberthur said the embedded chip, which uses hardware from STMicroelectronics, is undergoing certification by China UnionPay, which has helped roll out more than 1 million contactless point-of-sale terminals in the country. The same embedded chip is used in the Samsung Galaxy S4.

As NFC Times reported earlier this week, the new Xiaomi Mi3 flagship carries an NFC controller from Broadcom, believed to be Broadcom’s first combo wireless chip incorporating NFC, the BCM43341. Broadcom pairs its NFC modem chips with the high-memory Oberthur/STMicroelectronics secure element.

“Through this partnership with Xiaomi, Oberthur Technologies supports the new mobile payment ecosystem in China,” Oberthur’s telecom business unit head Cédric Collomb said in a statement.

Oberthur did not specifically say the embedded chip would be used by UnionPay, China’s large payment network. But UnionPay is working with chip and device makers to enable its contactless application, Quick Pass, to run on NFC phones in China’s unsubsidized phone market, NFC Times has learned. That likely includes talks between UnionPay and Samsung to use the latter’s embedded chips.

UnionPay is also working with China Mobile and other Chinese telcos to enable its contactless application on NFC SIM cards and has a “partnership” with China Mobile for the launch last June of NFC payment in 14 markets in China. Results of that launch, however, have been disappointing so far.

Xiaomi, which recently hired away Google’s vice president of product management for Android, Hugo Barra, offers customized versions of Android, and its smartphones are reasonably priced.

Xiaomi had 5% of China’s fast-growing smartphone market in the second quarter of 2013, according to research firm Canalys. That is higher than Apple’s falling share, though well below Samsung, which has a share of more than 15%, according to the firm.

Founded only three years ago, Xiaomi, predicts it will sell 20 million phones this year, and seeks to expand outside of its main market of China. At present, the only other markets it sells in are Hong Kong and Taiwan.

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