South Korean regulations for NFC payments to Be Released in Second Half of This Year

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South Korea’s card industry has begun to establish standards for NFC (Near Field Communication) mobile payments and it is predicted that infrastructures for NFC payments will be set up in second half of this year at the earliest. 

If these standards are established, South Korea’s card industry does not have to depend on technologies of foreign card companies such as Visa and UnionPay and can provide inexpensive terminals for NFC payments throughout South Korea.

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According to financial industry and IT industry on the 30th, application (app) card businesses such as Shinhan, Samsung, KB, Lotte, Hyundai, and NH Card and USIM-based mobile card businesses such as Hana Card and BC Card have agreed to establish South Korea’s regulations for NFC payments.

They will form a mobile consultative body shortly and are going to develop versatile NFC payment terminals that are equipped with specifications of South Korean payments and supply pads. KB Card will be the one that oversees this consultative body, and an actual discussion about establishment of NFC standards will start shortly.

South Korea’s card industry has begun to establish standards for NFC (Near Field Communication) mobile payments and it is predicted that infrastructures for NFC payments will be set up.  A customer is making a payment through NFC technology (name of app card: KMotion) at a store that is located in Gwanghwamun Gate.  Staff Reporter Kim, Dongwook | gphoto@etnews.com

South Korea’s card industry has begun to establish standards for NFC (Near Field Communication) mobile payments and it is predicted that infrastructures for NFC payments will be set up. A customer is making a payment through NFC technology (name of app card: KMotion) at a store that is located in Gwanghwamun Gate. Staff Reporter Kim, Dongwook | gphoto@etnews.com

A reason why card industry has agreed to establish its own regulations is because many platform businesses and manufacturers and foreign businesses have begun to infiltrate into a process of NFC infrastructures being expanded. Apple and UnionPay are investing huge amount of their funding into supplying NFC infrastructures. Although South Korea had attempted few times to expand NFC payments due to a problem regarding supply of infrastructures, all of them had failed. 

A reason why card businesses are still trying to expand NFC-based infrastructures is because there is a high chance that an ecosystem of mobile payments will rapidly change into a NFC-based ecosystem. App card businesses and USIM card businesses had sporadically supplied mobile cards while they were competing for superiority in technologies. Due to disagreements within businesses, there were not co-standards for NFC payment infrastructures.

App card businesses and USIM card businesses have agreed to stop their battles for superiority and to compete against foreign businesses through establishment of separate regulations.

“NFC infrastructure terminals that are based on EMV (Europay Mastercard Visa) regulations, which are the major terminals that are being used throughout the world, are very expensive.” said Department Head Byun Ki-ho of KB Card. “If our own regulations are established, we will be able to engraft inexpensive pads and others and expand South Korean NFC infrastructures that can be popularized.”

If a progress of foreign supply is considered, experts believe that mobile payments will shortly change into NFC payments.
South Korea’s card industry has set a goal of expanding NFC payment infrastructures regardless of card businesses throughout South Korea by end of this year and is going to supply them to offline stores. Card businesses believe that competition between themselves is meaningless and have declared to compete against global businesses.

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“It is crucial to how much we can provide level of convenience through offline if we want to compete against other global businesses such as Apple in mobile payment markets.” said a representative of an app card business. “Our primary tasks are to provide unified NFC regulations and inexpensive NFC infrastructures.”

Staff Reporter Gil, Jaeshik | osolgil@etnews.com

 

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