First Data Taps MicroSD Cards As Next Contactless Step

First Data Corp. plans to use technology embedded into a digital memory card as the next step in evolving the payment processor’s contactless-payment technology.

Atlanta-based First Data on March 16 announced it will use microSD cards supplied by Tyfone Inc., a Portland, Ore.-based company, that contain an electronic wallet. Consumers may insert the cards, called SideTap, into mobile handsets. They also can attach a secure digital card reader to their phones.

The card can hold multiple payment applications and has a contactless antenna, First Data says. Consumers can tap phones containing the card against a contactless reader to conduct transactions.

“We see the microSD as another steppingstone in the evolution to Near Field Communication and contactless payment inside the handset,” Dom Morea, First Data division manager of Mobile Commerce Solutions, tells PaymentsSource. The SideTap cards put the payment application inside the handset, a necessary step as the payments industry prepares for the potential of widespread adoption of NFC technology, Morea says.

First Data is no stranger to developing contactless-payment technology. Last year, the processor expanded the availability of its Go-Tag, a contactless device consumers can place on the outside of a device, such as a mobile phone (see story).  And Altoona, Pa.-based convenience store chain Sheetz Inc. began selling Go-Tag stickers in its store last year (see story).

First Data will hold SideTap trials midyear and expects a commercial debut later this year. SideTap will be available through financial institutions, retailers and wireless telecommunications companies, Morea says. The SideTap cards are not restricted to use in the United States, but most of the “effort is around U.S. activity,” he says.

Besides payment, the cards also can support loyalty applications and prepaid card data. The cards contain a smart card chip to secure the data. The memory card is compliant with ISO 14443 and MiFare contactless-payment standards used in payment networks and transit systems.

Regarding when First Data might introduce a full-fledged NFC device, Morea says many variables will affect that timeline. It especially hinges on the timing of widespread consumer adoption of NFC-equipped mobile phones, something he estimates is probably two years away. “It’s anybody’s forecast on that,” Morea says.

In a report last year, UK-based Juniper Research forecasted NFC mobile-payment transaction value could reach $30 billion globally by 2012.

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