Barclaycard and mobile operator Orange have joined forces to bring Britain its first taste of Near Field Communication (NFC) transactions using a mobile phone. You can use the system to make payments of up to £15.00. All the user has to do is wave their NFC enabled phone close to a receiver and the money is transferred. For those of you with the Bump app think of it in a similar way except you are swapping money instead of contact details.

At the time of writing this article Orange are only offering the service on the Samsung Tocco handset in spite of the fact that the Samsung Galaxy S also includes NFC technology. In addition you must have an account with either Barclaycard or an Orange credit card. You then upload money to your phone and this can be used to make purchases.

My major concern was that it would be possible to skim cards with the right technology. All a bad guy would need to do is put a NFC reader in a shoulder bag and walk round a busy shopping centre or railway station and quietly take £15.00 off everybody that he passes. The good news is that although it NFC is marketed as pinless transactions you can choose to use a PIN to authorise your transactions. I think the fact that there is a transaction limit shows that the founders of this system have some concerns about security, or perhaps they think that having a small transaction  limit will help encourage people to adopt the new system.

I think as with a lot of technologies it will take a while to catch on. I believe that whenever anything changes with regards to financial transactions the general public always view it with a degree of scepticism and trepidation, but that as they see other people using the technology then they will start to adopt it.

This is the first incarnation of NFC transactions here in the UK and it is likely that there will be others in the not so distant future. Which becomes the de facto standard we will have to wait and see but this is surely yet another nail in the coffin of cold hard cash.

So will you be an early adopter or will you wait and see how things pan out? Leave me a comment and let me know your views.