In his 1888 novel “Looking Backward 2000-1887,” American writer Edward Bellamy envisioned a utopian world in which cash has been replaced by credit/debit cards. Bellamy was the first to write about such cards, forty years before anyone else.
Now, in acknowledgement of the prescient writer, Swatch has named its new pay-by-the-wrist watch the “Swatch Bellamy,” a contactless payment wearable. The device, a collaboration of Swatch and Visa, is an NFC (near-field communication) enabled watch that works like a bankcard. The watch contains a built-in NFC antenna hidden under its dial and a Visa contactless chip, which enables it to communicate with payment terminals. Consumers pre-load funds into their associated bank accounts and pay for items using merchants' contactless point of sale (POS) terminals.
Contactless NFC technology uses high-frequency radio waves to enable electronic devices to communicate over short distances, usually less than 10 cm.
“Visa’s payment technology is powering the next generation of commerce, changing everything we know about shopping and paying, making sure purchases made with a watch are as reliable, safe and beneficial as the traditional card,” said Chris Curtin, Chief Brand and Innovation Marketing Officer at Visa.
MOBILE WALLETS: LEAVE YOUR CASH AND CARDS AT HOME
"Mobile payment makes the transaction through the individual’s bank account, debit card or credit card independently," says Natraj Pandal. However, mobile wallet payments are processed through a mobile wallet account.
“The key objective of the mobile wallet is to facilitate a user with an electronic wallet where all the contents of a real wallet such as cash and cards are electronically available at anytime and anywhere,” she says.
A mobile wallet helps customers to make mobile payments, which includes storage of payment credentials (on the device or on the cloud), and consequently making them available at the POS, or when needed. Additionally, mobile wallets support many kinds of functionalities, including automatic redemption of loyalty points and location–based marketing offers.
The Swatch Bellamy represents an example of proximity payment, Pandal explains. The technology is a type of contactless payment in which the customer conducts payment through short–range communication technologies, which include radio frequency identification (RFID), near–field communication (NFC), Bluetooth, and infrared.
The action of completing a contactless payment does not require any energy, meaning that the watch’s battery can last for years. The wearable also retains the discreet look and feel of any normal watch so that nothing will reveal its payment capabilities to passersby.
PAYMENTS INDUSTRY SHIFTING FROM PLASTIC TO DIGITAL
The payment wearable contactless watch joins another similar device introduced by Visa to its Team Visa athletes participating in the Rio 2016 Games this month: a payment wearable contactless ring. Backed by a Visa account, the ring also is NFC-enabled, allowing its wearers to make purchases by simply tapping their ring at any NFC-capable payment terminal.
Unlike many other payment wearables, the ring doesn’t require a battery or recharging. It’s also water-resistant to a depth of 50 meters.
Visa is strengthening its stronghold on mobile payments with the introduction of the Digital Commerce platform, which offers financial institutions such as Webster Bank and PNC Bank the ability to roll out their own consumer-facing apps. To help with the mobile payment scheme, the financial services and global payments technology giant is deploying 4,000 NFC-capable POS terminals around Olympic venues.