Near Field Communication (NFC) Near-Area Contactless

How does it work

According to the principle of operation, NFC is similar to Bluetooth, but when connected to another NFC device, you do not need to spend a lot of time identifying, communication is established almost instantly (in tenths of a second).

NFC is a wireless short-standing technology that operates at 13.56 MHz, used for industrial, medical and scientific purposes. NFC is a logical continuation of RFID technology, and its main difference is its limited range. While the reading distance of RFID tags can reach several hundred meters, NFC tags are available within 10 centimeters. NFC always has an initiator and a target. The initiator actively generates a radio frequency field that can affect the passive target. NFC communication between the two devices is also possible, provided that both devices are enabled. Due to its compact size and low power consumption, NFC can be used in small gadgets with^[1]

For data transmission, NFC uses coding with a different modulation coefficient depending on the data transmission rate. At the same time, NFC devices are able to simultaneously receive and transmit data. Thus, they can monitor the radio frequency field and detect inconsistencies if the received signal does not correspond to the transmitted one.

Use Cases

Contactless payments

Main article: Contactless NFC payments

The main advantages of NFC technology are the speed of payment for goods and services, security and convenience. The technology significantly reduces customer service time:

• in stores,
• in a cafe,
• at the gas station,
• on public transport
• in parking lots,
• at cultural and sporting events, that is, in places where a large number of people are simultaneously served and instant payment authorization is required, and the purchase amount is relatively small.

NFC - reader mode

In this mode, the smartphone acts as a scanner of NFC tags containing various additional information. Recently, NFC tags have begun to displace barcodes. They can be found on food in supermarkets and, having brought a device with NFC support, find out the expiration date and composition of the product. NFC tags are also used to display interactive advertising information.

Accounting of working time and accounting of schoolchildren

In addition, NFC can be used in time accounting systems for Time & Attendance (T&A) enterprises, as well as in innovative services such as an electronic home key to control school attendance and student nutrition.

"Smart posters" in advertising

In particular, Smart Posters based on NFC technology provide advertisers with new opportunities for interactive marketing with reference to the user's location. With their help, potential customers can quickly and easily get additional information about the product, advertising offer, receive a discount coupon, subscribe to the service, take part in the voting, etc.

NFC peer-to-peer mode

In this case, the two devices communicate with each other to exchange information. Thus, you can transfer contacts from one smartphone to another or settings from - Wi-Firouter to a mobile device.

Car keys

2024: World's first NFC key standard for cars approved

On July 17, 2024, the Car Connectivity Consortium (CCC) announced that automaker BMW Group and semiconductor component supplier NXP Semiconductors were the first two companies to receive digital key certification for CCC Digital Key vehicles. We are talking about using an NFC-enabled smartphone to drive a vehicle. Read more here.

NFC Technology Market

2014: MarketsandMarkets: NFC market to expand to $16.25 billion by 2022

Experts from the analytical company MarketsandMarkets made a forecast in the summer of 2014 that the NFC market will increase to $16.25 billion by 2022. The average annual growth will be about 8.83%. The research was carried out in the following areas of the market: products (integrated circuits, cable tips, readers, auxiliary devices), applications (payments, transportation, booking, data exchange, service, access control, etc.) and by geography of manufacturers.

The NFC market will thrive in the near future, according to MarketsandMarkets experts. NFC is a very dynamic market and contains great potential in many verticals of industry. Technological advances, thanks to the constant implementation of R&D, make this market one of the most significant segments in the current industrial scenario. NFC products are being developed and constantly developing, new technologies allow you to increase the life cycle of products and systems and their reliability. Among the features of NFC technologies, experts note a high level of interaction with other devices that support NFC, characteristics that allow you to withstand harsh environmental conditions and a longer life.

The competitive environment in the NFC market is a very interesting picture, where a large number of small players are gradually becoming a force that must already be reckoned with. The market is witnessing large-scale examples of cooperation and partnership in order to improve the quality of products and supplies among first-order players around the world.

According to a report by MarketsandMarkets, the main players in this area are:

• Broadcom (USA),
• Gemalto (Netherlands),
• Inside Secure (France),
• Infineon Technologies (Germany),
• MediaTek (Taiwan),
• NXP Semiconductors (Netherlands),
• Renesas Electronics Corporation (Japan),
• Samsung Electronics (South Korea),
• STMicroelectronics (Switzerland) and
• Texas Instruments (USA).

The MarketsandMarkets report also looks at market trends, drivers and issues. Experts analyzed the NFC market of various regions: America (North America and South America), Europe (Great Britain, Germany, France, Italy and the rest of Europe), Asia-Pacific (China, Japan, Korea, India and the rest of the Asia-Pacific countries) and the rest of the world (Middle East, Australia and Africa).

America on this list is the largest geographic center in terms of NFC market value - this parameter in the United States is the largest among other regions. The Asia-Pacific region has been identified as the fastest growing region and a leader in technological NFC devices. Europe also has a very promising market, including Germany and the UK. The NFC market of other countries is also gradually developing and there you can observe certain trends towards its growth.

Regulatory regulation of NFC in Russia

In the spring of 2015, the Ministry of Communications and Mass Media published an order on its website regulating the use of NFC short-range communication devices built into CNews smartphones and tablet computers in Russia: the Ministry of Telecom and Mass ^[2].

The document of the Ministry of Digital Development, Communications and Mass Media defines various characteristics of operation of NFC devices:

• modulation parameters,
• coding,
• transmission rate,
• the RF structure of their interface, and
• initialization schemes and
• conditions required to control conflict situations during initialization for both passive and active NFC modes.

The requirements imposed by the order of the Ministry of Telecom and Mass Communications to NFC communications in Russia correspond to the already established practice of its application.

Reporting on the emergence of the NFC regulatory framework, the Ministry recalled that devices with support for this protocol allow the implementation of "various services," for example, using a mobile phone as a transport card, means of payment, etc.

NFC smartphones

2019

NFC-Enabled Smartphones Share Reaches Half of Market in Physical Terms

M.Video-Eldorado analyzed the demand for smartphones with a contactless data transmission (NFC) module in 2019. Sales of devices with technology support grew by more than 20% in units, and their share reached half of the market in physical terms. This was reported on February 11, 2020 in M.Video-Eldorado.

The presence of an NFC module in the smartphone allows you to pay for goods and services in one touch. According to the M.Video-Eldorado Group, every second smartphone purchased by Russians in 2019 supports the technology - this is about 15 million pieces. Since 2016 (in the year of the launch of Apple Pay in Russia), the share of such mobile devices in quantitative terms has increased almost 2.5 times - from 20% to 50%. In unit sales of M.Video, such smartphones occupy already 65%.

The smartphone is chosen as a means of payment because of its convenience and security - 7 out of 10 purchased devices are equipped with biometric sensors. The proliferation of gadgets with NFC chips, including smartwatches, contributes to the growing popularity of cashless and contactless payments.

Smartphones with contactless payment become more affordable, the average price over the past four years has decreased by 34%, up to 25 thousand rubles. The technology is available not only in most devices from the middle and upper price segments, but also in budget models worth less than 5 thousand rubles. The most popular devices of 2019 with NFC support were the Samsung Galaxy A50 and four models from Honor: 8A, 10 Lite, 8X, 10I, noted in M.Video-Eldorado.

"The popularity of cashless payments, in addition to increasing the range of digital devices with NFC and their growing availability, is facilitated by the spread of modern POS terminals, their penetration into new areas of business, the emergence of new mobile payment systems, as well as the connection of new banks. At the end of 2019, we recorded a twofold increase in the volume of contactless payments from mobile devices in the M.Video and Eldorado networks, the average check for such contactless payments increased by 12%. To pay for a purchase in a store or courier, customers can choose any convenient way, including smartphones or smart watches. Last year, an increase was observed in all payment systems. The largest share in terms of transactions falls on Google Pay (about 70%), but the highest dynamics was demonstrated by the Android Pay system (an increase of more than 2.5 times), " noted Iliza Dmitriyeva, Head of Treasury and Corporate Finance Department of M.Video-Eldorado Group

As a payment tool, Russians choose a smartphone not only due to simplicity and convenience, but also increased security. To confirm payment, you must enter a code password or use. biometric scanner At the end of 2019, one or several sensors (fingerprint scanner, iris face recognition system scanner) were installed in more than 70% (+ 10 pp) of devices purchased by Russians, in money their share was 90% (+ 10 pp). The most common and affordable biometric technology remains the fingerprint scanner. The average cost of devices with the possibility biometric authentication continues to decline and in 2019 amounted to 20.3 thousand rubles., which is 8% less than in 2018. In the sales of the M.Video network, smartphones with biometrics took more than 85% in pieces and 95% in money.

Another replacement for a bank card and an increasingly popular payment device is a smartwatch. Sales of the category for 2019 increased in pieces by more than 60%. However, the ability to pay mainly has accessories from the middle and upper price ranges, supporting the main payment systems Apple Pay, Google Pay, Samsung Wallet (formerly Samsung Pay), Garmin Pay. More affordable fitness trackers with a built-in NFC module have also appeared on the Russian market. For example, a special modification of Xiaomi Mi Band 4 has a sensor, but as of February 2020, the country is not supported by a suitable payment system.

Manufacturers may be required to install the Russian Mir Pay service on smartphones with NFC

On December 27, 2019, it became known that application Mir Pay the Russian payment system "" World may become mandatory to install on all Russia gadgets sold with support for NFC contactless payment technology. As of December 2019, the Federal Antimonopoly Service () is considering this possibility. FAS Russia

According to Izvestia, the issue of adding the Mir Pay contactless payment service to the list of pre-installed Russian applications was raised at a meeting of the FAS working group. The law on the mandatory installation of domestic software on all devices sold in Russia with a full-fledged OS was signed by Russian President Vladimir Putin on December 2, 2019. It will enter into force on July 1, 2020.

All applications of the Mir ecosystem can become mandatory for preinstallation. It includes not only Mir Pay, but also the "Hello, World!" service application with system promotions.

The Mir Pay application is the Russian analogue of Google Pay, Samsung Wallet (formerly Samsung Pay), Apple Pay and other foreign payment systems officially authorized for use in Russia. They all work using Near Field Communication (NFC) technology and, in fact, turn a smartphone into a kind of electronic wallet.

The NFC chip is far from all smartphones and even more so, tablet computers but in Russia the number of gadgets sold with it inside is in the millions. According to to data "" Coherent for 11 months of 2019, about 11.7 million smartphones NFC were sold in Russia.

Another thing is that in December 2019, the bulk of the cardholders of the Mir payment system are employees of budget departments who receive wages for these cards, as well as pensioners to whom their pension is transferred. How popular the contactless payment service will be for these categories of people is unknown. Meanwhile, as of December 27, 2019, over 70 million Mir cards were issued, and according to the results of the third quarter of 2019, the share of the card in the total issue of "plastic" in Russia reached 22.4%^[3].

2014: Share of smartphones with NFC reaches 18%

According to analysts Euroset"" in 2014, the share smartphones with NFC support in the Russian market increased to 18%, and their share in sales revenue for the year increased from 30% to 35%. Such a big difference is explained by the fact that smartphones with NFC support it is twice as expensive as devices without this function, and their average cost is about 17,000 rubles. Moreover, if the average price of phones without NFC for the year decreased by 7%, then the cost of smartphones using this technology remained unchanged^[4]

According to Svyaznoy specialists, according to whom, the share of NFC smartphones in total smartphone sales in 2014 remained at the same level of 16%, and the share in revenue from their sales increased from 29% to 35%.

And analysts at J'son & Partners Consulting calculated that in 2014 NFC smartphones occupied 17% of the Russian market with a revenue share of 35%. As for the number of POS terminals with support for contactless payments, their number has doubled.

Vedomosti journalists clarified that the number of registered NFC devices in the MTS network in 2014 doubled and reached a share of 8%, and the penetration of NFC smartphones in the VimpelCom network increased 4 times. At the same time, analysts admit that the Russian NFC market is still based on enthusiasts, whose number does not exceed 2% of the total audience of financial services. And these payments have not yet received mass distribution, and NFC support is not a critical criterion when choosing a new phone.

2012

125 million NFC phones delivered to the global market

In 2012, 125 million NFC phones and 147 million NFC (secure elements) security elements were delivered to the global market according to ABI Research.

The ratio of NFC-enabled goods sales to chip sales is growing, vendor NFC devices are winning the market, and their partners in local markets, which have long been inactive, complaining about a slight penetration of technology, are today developing their own innovative ways to apply NFC, bringing all new NFC services and NFC applications to the market.

Much of the observed developer activity is concentrated around "non-payment" NFC applications designed to develop interactive user communications. Such applications allow consumers to use their smartphones to access various content in an easier and more innovative way, and at the same time are beneficial to vendors, increasing the interest of buyers in their NFC products.

According to Berg Insight (2012), sales of NFC smartphones will grow in the next 5 years with a CAGR of 87.8%, thanks to which 700 million units will be delivered to the market in 2016.

28 NFC-enabled phone models are available in Russia

One of the main factors affecting the development of the NFC market is the availability of appropriate infrastructure and subscriber devices.

According to mid-June 2012, 28 models of phones/communicators with NFC support from 8 manufacturers were available in Russia:

• Nokia Corporation (7 models),
• RIM and Samsung (6 models each),
• Sony (3 models),
• HTC, LG (2 models each),
• Fly and Panasonic (1 model each).

The cost of phones with NFC support starts at 6.4 thousand rubles. (Samsung Wave 578 S5780) up to 70 thousand rubles. (BlackBerry Porsche Design P’9981).

Q1: 1.2% phones sold have NFC support

According to J'son & Partners Consulting, Russia there is a significant increase in the share of sales of NFC-enabled phones - from 0.7% in Q4 2011 to 1.2% in Q1 2012. However, for the end user of NFC in Russia, this is an unimportant option that does not actually affect consumer demand and sales. smartphones

As of July 2012, it is usually impossible to use phones with support for this technology in Russian projects - this requires a special NFC module that is installed in the phone, or a bank card with NFC support.

2011: 30m NFC-enabled phones sold worldwide

According to the results of 2011, 30 million NFC-enabled mobile phones were sold in the world and at least 40 NFC models were released.

According to forecasts of IMS Research, 80 million NFC-enabled mobile phones and about 300 million NFC chipsets will be sold in the world in 2012, and by 2015 these figures will reach 400 million and 1200 million, respectively.

2010: Juniper Research: 300 million NFC chip smartphones to be sold in 2014

Juniper Research projected in 2010 that at least a fifth of smartphones would be equipped with an NFC chip by 2014. And the total number of such communicators will reach 300 million. The largest penetration of NFC technology, according to analysts, will be observed in developed regions, in particular in North America and Western Europe.

2004-2006: Nokia 6131 - the first phone in Russia with NFC support

In March 2004, Nokia, Sony and Royal Philips Electronics organized the NFC Forum, a non-profit association for the standardization and promotion of NFC technology. In 2006, the first NFC specification appeared and the first commercial phone with an NFC chip, Nokia 6131, was released, but this initiative did not receive a full continuation. In 2011, Google joined the NFC Forum.

1983

The history of NFC technology dates back to 1983. Then electrical engineer Charles Valton received a patent for a "portable radio frequency emitter-identifier."

NFC in the world

The most widespread services in the world are contactless ticket sales for public transport and ticketing and payment for goods and services.

Korea

In mid-2011, South Korean mobile operators, plastic card issuers, consumer electronics manufacturers and government organizations established the Grand NFC Korea Alliance, the main goal of which is to create a new market with a volume of $1 billion and more than 5 thousand new jobs.

Great Britain

In the United Kingdom, the postal service plans to install 30 thousand. NFC terminals in 11.5 thousand post service offices throughout the country (July 2012). Users will be able to pay for services through Mastercard PayPass or Visa PayWave contactless cards and NFC smartphones.

Interesting initiatives are promoted by banks. For example, customers of the Royal Bank of Scotland (RBS) since 2012 can receive cash (up to £100) from ATMs without a bank card - for this they will need a smartphone.

France

In the summer of 2011, the French government announced its readiness to invest €20 million to promote NFC-based services. Four mobile operators and four banks announced their plans to launch NFC services nationally in 2012.

Germany

In early 2011, transport companies - the German national railway operator Deutsche Bahn (DB) and RMV began cooperation on the creation of a national NFC ticketing system in Germany.

Qatar

Qatar National Bank (QNB), in partnership with mobile operator Qtel, offers customers a cash bonus of up to 100 Qatari reais (about $27.5) when activating an account for payments using NFC and making at least one transaction.

Brazil

Brazil accounts for more than 70% of all e-commerce operations in the region, and now the country is also giving a boost to mobile payments, American Banker reported in November 2014. In Brazil, the number of mobile phones exceeds the number of inhabitants (272.4 million with a population of 199 million). Thus, Brazil is the fourth largest mobile market country in the world. At the same time, 65 million people - about half of the adult population of the country - do not use banking services. Like Kenya before the advent of the MPesa payment service, these are ideal conditions for the rapid development of mobile payments.

Brazil announced the introduction of a new regulation that encourages competition in mobile payments among both mobile operators and payment service providers. The country is creating a system of interaction between all players, in which fees and commissions will be strictly controlled by the Central Bank. In addition, much attention will be paid to NFC and contactless technologies.

In 2013, the number of smartphones in Brazil for the first time exceeded the number of mobile phones. Visa, in turn, announced the introduction of contactless payment technology for the 2016 Olympic Games. Together with a new initiative combining mobile operators, payment systems and the government, mobile payments can in the near future not only show rapid growth, but also surpass all other payment methods in the Brazilian market.

NFC security

2018: Using NFC to steal data over comparatively long distances

On October 19, 2018, it was reported that Checkmarx specialist Pedro Umbelino demonstrated a method called NFCdrip, which allows you to transfer small amounts of data (passwords or encryption keys) over relatively long distances using NFC technology.

As you know, the NFC protocol allows two devices to communicate with each other at a distance of up to 10 cm. However, as Umbelino found out, in reality the technology is capable of working at longer distances and, as a result, can be used to secretly extract data from physically isolated devices with disabled Wi-Fi, Bluetooth or GSM.

The NFCdrip attack involves changing the NFC operation mode to modulate data. In the case of OS Android changing the mode, special permissions will not even be required, the researcher noted. NFCdrip uses on-off keying when the presence of a signal is considered as 1 bit and the absence as 0 bit.

In the course of his experiments, the researcher demonstrated how malware installed on an Android device can be used to transfer a password to another Android gadget connected to a simple AM receiver, located at a distance of tens of meters. Data is easily transmitted over a distance of 2.5 meters at a speed of 10-12 bits per second. Errors occur when passing over a distance of 10 meters, but, according to Umbelino, they are amenable to adjustment. When transmitting over long distances, the signal weakens and a large number of errors occur, but the expert still managed to transmit some data over a distance of more than 60 meters. This value can be increased if you use an AM antenna and an SDR receiver, says a Checkmarx specialist.

According to him, the method can work on devices in "flight mode" and poses a threat not only to Android devices, but also to laptops and other types of gadgets. ^[5]]

NFC Competitor - Color Coding

On June 7, 2016, it became known about the development of "color coding" technology by Payment Technologies (Italy)^[6] to ^[6]

Payment Technologies (Paytec), a developer of technologies for payment systems, is working on the introduction of this technology in its vending machines to accept contactless payments using mobile devices.

Opto technology allows consumers to make contactless payments from any smartphone without using NFC, the company said. Contactless technology that transmits data encrypted at different frequencies by "color coding" to an optical reader in a vending machine.

Unlike NFC technology, Opto uses what the smartphone has - display light. Owners of all smartphones can pay for purchases using their mobile device.

A Paytec spokesman announced interest in the release of the technology from a number of vending machine operators in Europe.

Opto technology uses tokenization through color-coded light. The technology was originally developed for the vending sector. However, the scope of this technology is by no means limited to vending machines. For that matter, it is not limited to payments. Jonathan Hayes, CEO of Dinube

In addition to the convenience and usability on any smartphone, the developers also talk about a higher level of security for Opto technology compared to NFC. Although NFC transmits information with a short range, in certain circumstances the data can be intercepted and compromised. Light signals are more difficult to intercept, since the light of the smartphone display is naturally scattered by ambient light.

A group of scientists from the University of Universitat Politècnica de Catalunya (UPC) and employees of the i2Cat Innovation Center in Barcelona, ​ ​ Spain took part in the development of the technology.

Notes