Going cashless is the way forward. Whether you like it or not, paying for an item using real money from your wallet will soon become a thing of the past.
Over the last half-decade or so, the emergence of ewallets, faster connection speeds, and more efficient interfacing between software has enabled us to become more at ease with cashless technology.
And thanks (or no thanks) to the COVID-19 pandemic, people have been forced into adopting the use of ewallets, wireless transfers, and tap-and-go transactions – be it with a credit card, smartphone, or smartwatch – much more rapidly.
As revealed in a survey conducted by Mastercard, about 79 percent of people worldwide claim to actively use tap-and-go-style payments. In the Asia Pacific region, that figure is closer to 91 percent.
Alongside the shift towards cashless, tech companies are also trying to keep up by introducing new ways to pay without using real money, especially for payments made offline in public spaces.
Of course, you have your Europay, Mastercard, and VISA (EMV)-enabled credits cards, smartphone app-based ewallets, and your Near-field-Communication (NFC)-equipped wearable devices like smartwatches all occupying the current space. As it is, they've become fairly straightforward to use, are pretty secure, and are constantly being improved as time goes by.
But technology equates to constant innovation, no matter how big or small the jump, and it only makes sense that we'll soon welcome some technology company's idea of what contactless payments should be as the universally-agreed-upon next step.
So, what could that be?
Enter payment wearables.
One possible and probable future for the cashless movement is the use of everyday wearables as payment vehicles.
Before you get confused, we're not talking smartwatches or smart fitness bands. Instead, we're talking about everyday accessories like the straps for your analog wristwatch, your keychains, your necklaces, or your bracelets.
The idea is simply this: By outfitting everyday accessories with small flexible chips equipped with wireless capabilities, there is an opportunity to transform inexpensive fashion accessories that you wear daily into a device you can use to pay with.
More likely than not, it'll be a concept that people will find more appealing than having to spend extra cash on a smartwatch, or having to whip out their phones every time they want to pay for something at the grocery store or their local Starbucks. Plus, you get to mix and match styles.
Interestingly enough, such technology is generally ready for widespread public use, as evidenced by the existence of brands such as TapStrap and K Ring that create wearable accessories (watch straps and rings, respectively) embedded with NFC-enabled chips.
Then there's also U.S. watchmaker Timex's purported partnership with Canadian technology company Tappy to create NFC-ready timepieces that support tap-and-go transactions (though we're yet to see the first product specimens).
Even the question of widespread adoption should be easily answered – NFC-chipped wearables will be usable at the very same terminals that allow for Mastercard PayPass and VISA PayWave transactions, meaning that merchants won't have to bother with things like buying new machines or teaching staff how to work with a new system.
Security via tokenization.
So, if payment-ready wearables are the next evolutionary step in the move towards a cashless world, the next concern to address is security. How can any of these wearables be safe against hackers or fraudsters in the real world?
The most likely answer is the concept of tokenization – a process that converts sensitive data like your bank or credit card details into a string of meaningless letters and numbers called a token that can't be deciphered unless it reaches a token vault, where all your details are securely stored.
Only once it reaches the vault will the tokens be used to retrieve your details for the purpose of completing a transaction.
While this may all sound complex, the wider implications of tokenization are basically stronger prevention of fraud and heightened security, meaning fraudsters won't be able to replicate your card information and hackers will have no useful information to steal.
And just like the concept of integrable chips, credit card tokenization is ready for widespread public adoption.
Developing upon the previous example, Mastercard and Tappy recently announced a partnership with Singaporean tech company MatchMove to insert tokenized Mastercard credit cards within Tappy's line of NFC chips, ostensibly improving the level of security for future payment wearables when more people start using them.
"Our goal is to rewrite the standards of consumer wearable by producing products that are secure, easy to use and at the same time maintaining the natural aesthetics of the fashion wearable accessories which is critical to end consumers,” said Mastercard about their objectives for pushing on with the development of payment wearables.
So, both and fashionable solution, then. Good to know.
Beyond encryption, payment and credit card companies might next look to introduce ways that will protect users in the event of lost wearables.
Just like how there aren't any bulletproof ways to safeguard users from unauthorized transactions after a tap-and-go card is lost, there aren't any surefire ways to protect against the same for NFC wearables.
Perhaps, something akin to proximity-based security can be implemented to prevent transactions if the wearable strays too far from a paired mobile phone or secondary device?
While it's all speculative, we can be certain that there will be some sort of fix to the problem appearing in the near future.
Coming soon?
It seems as if it's only a matter of time before payment wearables enter the mainstream.
Bar any hiccups with manufacturing, security, or governmental regulations from country to country, everyday users like you and I could very well be paying for our meals, transport, and clothes with the tap of a watch strap or a keychain.
The only question is how quickly such wearable chips will become available for the public, and how much they'll cost.
Hopefully, we won't have to wait too long to find out.
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Cover image sourced from Mastercard.
