Big retailers are contactless fans

Australia's two biggest retailers, Coles and Woolworths, report positive experiences in the early stages of deploying contactless payment technology. Both say transaction processing times are quicker, queues at check-outs are shorter and customer acceptance is high.

Both are also keen to explore more developments using near field communications and mobile payments.

Speaking at the CeBIT Future of Payments conference in Sydney yesterday, Woolworths' group head of financial services, Dhun Karai, said a transaction involving the insertion of a card into a chip reader or swiping a card through a magnetic stripe reader took an average of 30.6 seconds.

Woolworths has timed the average contactless payment at 6.4 seconds. "Queue lengths are shorter as a result," Karai said.

She said Woolworths was speeding up its contactless technology rollout and hoped to have the job done in three or four months, compared with its original nine-month schedule.

Coles started installing contactless readers in February and finished the job in June.

The company's head of payments, Doug Swansson, said: "It is early days, but already 40 per cent of Coles' MasterCard transactions are contactless. Acceptance is strong."

"We have seen the share of cash payments fall. Contactless is replacing cash. Our view is that customers are at a tipping point in the way they wish to pay. We see a big shift from cash to cards coming."

Swansson and Karai are both looking at NFC applications.

Swansson said: "NFC is bigger than payments. One of the big opportunities is to integrate payments and loyalty. We think we can use the technology to deliver the right offer at the right time.

"Mobile payments are very interesting to us, but we believe the real opportunity lies beyond payments."