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3-Mar-05 Hong Kong, March 3, 2005 - Fusion Consulting today released key findings from their whitepaper on the adoption of radio frequency identification (RFID) technology in contactless payment cards throughout Asia. While transportation companies are presently the main adopters of RFID payment technology, the Fusion Consulting whitepaper predicts that the future of contactless payment lies with credit card companies, with their existing networks, clearing systems and customer base. In Asian countries where there is not as strong a culture of credit card usage as in Europe or the US, mobile telecom users will be a growing target market. The paper also maps out specific areas of opportunity for credit card and mobile telecommunications companies and covers case studies by country. "Hong Kong and Singapore are highly developed markets, especially Hong Kong where RFID payment is used not only in public transport, but also at fast food restaurants, vending machines, car parks, wet markets, leisure centres, universities and most recently at the land registry," said Ms. Renia Lopez, Strategy Consultant at Fusion Consulting in Hong Kong. "Consumers in these countries are already familiar with the benefits of RFID transactions, mainly speed, and view it as a secure means of payment." "Interestingly, the more familiar users are with RFID technology, the less enthusiastic they are about integrating payment cards with other devices, telephones or credit cards. There is a reluctance to carry all their personal data in one device." "Nonetheless, the telecom industry is marching ahead with solutions that make devices, such as mobile handsets, compatible with the existing RFID technology (through NFC . Near Field Communications). Soon, consumers will be able to swipe their phones to gain access as they enter cinemas, having paid through the RFID compatible facility in their phones." Ms. Lopez said. "At the same time, credit card industry players have also been carrying out pilot tests with RFID devices (key fobs, watches, as well as credit cards), and the tests have been positive so far. Users don't have problems with the concept or the technology. Credit card companies also observed an increase in the amounts spent, particularly in low value purchases." "All in all, it is more likely that it will be the credit card companies who will end up dominating the RFID based payment market, rather than telecom companies. Credit card companies have the know-how needed to manage transactions, they have the point of sales networks and decades of experience in most markets. The telecom industry would need to coordinate all its players, vendors, operators, regulators - as well as banks and clearing houses - in order to offer customers seamless services. This is less likely to happen, except in countries where the whole industry is in the hands of a few local players." "The real challenge for credit card companies, will be to integrate new solutions with the existing systems (Octopus in the case of Hong Kong and EZLink in Singapore)," added Ms. Lopez. "Incumbents are already managing the transactions and they might be happier to partner with telecom players, who are less likely to have clearing house resources, but could introduce RFID payments to over 700 million customers, the predicted number of mobile subscribers for Asia for 2006." A copy of the whitepaper is available upon request. Please email more@fusionc.com. (We reserve the right to reject certain requests.) About RFID About the study About Fusion Consulting For more information, please contact Fusion Consulting at
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