According to this article, we're on the verge of the "electronic wallet", which will completely eliminate the accessible cash question: Editor's Corner Near Field Communications: The Next Big Thing? If you keep up with technology news, you may have already heard of something called NFC, which stands for Near Field Communications. This is yet another wireless communications protocol, a relatively slow method of transferring data that operates on the 13.56 MHz band and only works at extremely close distances, around 4 centimeters, which is only about one and a half inches. In other words, two devices have to be almost touching in order to communicate via NFC, although there are antennas that extend that distance up to 20 cm (almost 8 inches). You might wonder what good a wireless connection is if it requires being that close. The answer is that it can basically turn your mobile phone into a contactless card or RFID reader, or allow it to communicate with another NFC- enabled phone or device in a peer-to-peer relationship. So what does that mean? That is, what can you actually do with it? One of the touted uses is to be able to use your phone in place of a credit card, to make payments at retail stores, restaurants, and other points of sale. The phone holds your credit card data (encrypted, of course) and when you want to make a payment, you hold it up to the NFC device at the establishment, which reads the information, just as current credit card POS terminals read a card when you swipe it through them. The big advantage here is that you don't have to carry around a physical card (or, as most of us do, a dozen of them). It's easier to lose (or steal) one card out of a stack of credit cards without anyone noticing for quite some time. Most of us now carry our phones with us everywhere, and we use them enough so that we would readily notice if they were missing. Of course, there's a down side to this, too. If you keep all your credit cards on your phone, you have a single point of failure so that if you do lose the phone, someone now has access to all of them. But one could argue that the same is true of losing your wallet. I can already hear someone saying, "Yes, but your wallet can't be hacked into while it's sitting in your pocket" and that's an excellent point. Your wallet never connects to the Internet; your smart phone probably does, via 3G/4G, wi- fi or both. Obviously, for consumers to trust this type of technology, it will have to have very strong security controls so that if a hacker should gain access to the phone, he won't be able to crack the encryption on the credit cards or other ID information. And it's not just credit cards that some envision being baked into your phone eventually. Our driver's licenses, social security cards, health insurance cards, concealed carry licenses, membership cards, and pretty much everything else we carry in our wallets today could, technologically, become virtual "cards" that we carry stored in the memories of our phones. Imagine a day when you don't need to worry about shuffling through a bunch of cards or carry cash with you - everything you need is on your phone. All this is an extension of the digital wallet concept, which is used for shopping online. Digital wallet software stores user information such as credit card numbers, shipping and billing addresses, etc. and automatically transfers it to online payment forms when you make a purchase. NFC makes paying "in person" just as convenient; all you have to do is hold your device up to the retailer's reader to transfer the information. Some people will love this idea and others will hate it. Personally, I prefer the thought of a phone full of personal info - with the risks that go along with it - to that alternative vision of the future where we all have chips embedded under our skin, but that's just me. If you do like the concept, you might be wondering why another close-range wireless technology is needed. After all, we already have Bluetooth. But if you've ever set up a BT headset or keyboard or other device, you know it sometimes takes a bit of doing to get the devices to pair up. Two NFC devices will link up automatically and almost instantaneously. This is far more convenient - but of course it also creates some concerns about security. That's why the much shorter distance range of NFC (as opposed to the 1 to 10 meter range of BT) is actually an advantage. Another device will normally have to get very close to your device - close enough for you to notice - before it can establish a connection. However, eavesdroppers can use antennas to extend that range, so NFC is not invulnerable to attack. Another difference between NFC and BT is that NFC work with already-existing passive RFID tags, so an NFC enabled device can read those tags. NFC requires special hardware, so it's not something that you can just add to your cell phone by downloading an app. However, there are already a number of mobile phone models that have NFC capabilities, including the Google Nexus and the Samsung Galaxy S II. The iPhone 5 will reportedly support NFC communications, too, although there seem to be conflicting stories about that: http://www.wxpnews.com/8UIWD3/110412-NFC As that article notes, RIM has plans to include NFC in its new Blackberry devices, and there are also rumors floating around that the next version of Windows Phone 7 will have NFC, as well: http://www.wxpnews.com/8UIWD3/110412-Engadget Major companies are committing resources to making an NFC-enabled future happen sooner rather than later. Former Google CEO Eric Schmidt outlined his company's vision of what NFC will one day be able to do: http://www.wxpnews.com/8UIWD3/110412-Nearfield NFC deployments are in progress all over the world. France's mobile network operators plan to put out a million NFC-enabled phones this year and provide consumers in that country with NFC services that include not only retail store payments but also purchase of tickets for public transportation, storage of coupons and loyalty cards and information services: http://www.wxpnews.com/8UIWD3/110412-NFC-Phones Companies in Japan and South Korea are working together to create an NFC infrastructure for cross-border payments. NFC is being used in Switzerland in contactless kiosks that allow mobile phone subscribers to top up their phones. And Mastercard has announced its goal of making contactless payments a way of life in Australia and New Zealand: http://www.wxpnews.com/8UIWD3/110412-Pos-Terminals NFC is expected to be a big business in the coming years, and the industry even already has its own dedicated trade publications and events. Near Field Communications World Asia 2011 will be taking place this week, April 13-15, in Singapore. And you can delve more deeply into the subject of NFC by checking http://www.wxpnews.com/8UIWD3/110412-NFC-WWSite NFC is coming (and in some cases, already here), whether we like it or not.