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In recent years, we have witnessed a revolution in payment methods, driven by the growing adoption of mobile technology. One of the most notable innovations in this field is mobile pay-per-view, a feature that allows consumers to conduct financial transactions quickly, securely and conveniently just by bringing their smartphones closer to compatible payment devices.
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This technology uses Near Field Communication (NFC) to transfer data between the mobile phone and the payment terminal, eliminating the need for physical cards or cash.
In this article, we will explore the phenomenon of mobile approach payment and discuss its benefits, the technological evolution behind this method, and its impact on how we interact with the financial system. In addition, we will examine the security aspects involved in this type of transaction and address the future trends of this technology.
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Get ready to discover how your smartphone is becoming a powerful digital wallet, capable of simplifying day-to-day transactions, transforming the shopping experience and shaping the future of payments.
How Does it Work?
Mobile approach payment uses Near Field Communication (NFC) technology to enable short-range wireless communication between the mobile phone and the payment terminal.
The process involves the initial setup, where the user adds the card data to the digital wallet on the mobile phone. During a transaction, the user initiates the process, authenticates the transaction and brings the mobile phone closer to the payment terminal.
The mobile phone and the terminal establish a connection per proximity field, transferring the data necessary for the transaction. The terminal sends the transaction information to the mobile phone, which encrypts and transmits the card data to the terminal.
The terminal sends the encrypted data to the payment network, which forwards it to the card-issuing bank. The issuing bank verifies the authenticity and availability of funds by sending a response to the payment terminal.
The terminal displays the confirmation of the transaction, and the mobile phone can display a digital receipt. This process varies between the approximation payment solutions and the specific requirements of each country or financial institution.
Payment Security
Mobile proximity payment offers advanced security features to protect users’ transactions. Some of the key security aspects include:
- Encryption: The data transmitted between the mobile phone and the payment terminal is encrypted, ensuring that personal and financial information remains secure during transmission.
- Authentication: Before performing a transaction, the user needs to authenticate themselves using a security method, such as fingerprint reading, facial recognition, or entering a PIN code. This prevents unauthorized use of the mobile phone to make payments.
- Tokenization: Instead of transmitting the actual card number, payment by approximation uses tokens, which are unique and temporary codes. These tokens replace card data and reduce the risk of exposing sensitive information in the event of a breach.
- Fraud monitoring and detection: Financial institutions and payment service providers monitor transactions in real time, using advanced systems to detect suspicious activity and prevent fraud. If any unusual activity is identified, additional security measures can be triggered.
- Physical security: NFC technology requires the physical proximity between the mobile phone and the payment terminal to initiate a transaction, which reduces the risk of remote interception of data. In addition, approximation transactions typically require the user’s authorization and therefore cannot be carried out without the knowledge of the mobile phone owner.
It is important to note that the security in the payment by approach on the cell phone is a constant concern for the companies and institutions involved. They implement regularly updated security measures to protect users from ever-evolving threats and ensure secure and reliable transactions.
Trends and Future of Payment by Approximation
- Global expansion: Mobile proximity payment has experienced significant growth worldwide. As more countries adopt this technology and more merchants accept it, the use and popularity of proximity payment is expected to continue to increase.
- Integration with other technologies: The future of mobile approach payment involves integration with other emerging technologies. For example, the combination with the Internet of Things (IoT) could enable proximity payments on connected devices such as cars and smart home appliances.
- Biometric payments: Biometric authentication, such as facial recognition or fingerprint reading, is becoming increasingly common on smartphones. These technologies can be used to authenticate payment transactions by approximation, providing an additional layer of security and convenience.
- Wearables: Wearable devices such as smartwatches and bracelets are becoming popular among consumers. The integration of proximity payment on these devices offers an even more convenient and discreet way to carry out transactions, eliminating the need to take the mobile phone out of your pocket.
- Personalization and loyalty: With pay-per-view on mobile, businesses have the opportunity to offer personalized customer experiences. Through data analytics and integration with loyalty programs, you can offer personalized offers and rewards based on your user’s purchase history and preferences.
- Blockchain and cryptocurrencies: Blockchain technology and cryptocurrencies have the potential to play an important role in the future of mobile approach payment. The use of cryptocurrencies such as Bitcoin, along with blockchain technology, can provide more secure and efficient transactions.
- Cashierless shopping: Mobile approach payment is paving the way for the concept of “cashierless shopping.” With the use of sensors and sensing technologies, customers can simply pick up the desired products from the shelves of a store and leave, with payment being made automatically via mobile phone.
