A new payment method in the Netherlands:  100 customers will use Samsung SGH-X700 phones.

A small group of Dutch grocery shoppers has begun using contactless mobile phones in one of the latest tests of Near Field Communication technology.

NFC is a short-range wireless technology that allows phones to make contactless payments and to download information from posters and other items embedded with NFC chips.

In this test, scheduled to last until early 2008, 100 customers will use Samsung SGH-X700 phones to make purchases at a C1000 supermarket in Molenaarsgraaf, near Rotterdam, a source from LogicaCMG, a United Kingdom-based technology and business services firm taking part in the test told Card Technology’s sister publication CardLine Global.

The phones will store customers’ debit account information. Customers will tap the phones on readers at point-of-sale terminals and then enter personal identification numbers. “The advantage (to debit) is that we do not introduce a new payment system or a new electronic wallet that holds an amount of prepaid money, nor do we need customers to have a credit card,” the source said. “The pilot ties into the most common payment method and infrastructure in the Netherlands.”

The phones also can store bottle-deposit refunds. Also involved in the test are Netherlands-based Rabobank, Netherlands-based NXP Semiconductors, Dutch mobile network operator KPN and RFID Platform Nederland, a Dutch group that studies and promotes smart card technology.

The NFC trial is one of dozens that has launched over the past two and a half years around the world, most testing mobile contactless payment and transit ticketing. The latter application is expected to take off first in Europe, once NFC phones become available and service providers and mobile network operators work out fee arrangements.

Source: CardTechnology