Mobile contactless payment usually refers to a new technology that is being tested that puts a software version of your credit card in your mobile phone and allows you to pay for things with it. These payment transactions are called "contactless" payments because they require no physical connection between the cell phone and the checkout payment terminal. Instead of using a traditional credit or debit card, you bring the phone close to the check out terminal (less than 10cms) to make the payment without swiping or touching anything.

At present this type of system is being trialed in many countries. However, mobile contactless payment points and the right types of phones will soon become much more widespread. It is particularly suited to convenience stores and public transport systems, where you gain the advantages of a speedy payment for low value purchases.. If you travel abroad, and particularly to Japan, you will find that this technology has already become part of everyday life for consumers who frequently pay for their purchases in this way.

>How does mobile contactless payment work?

This type of payment works with the existing banking and financial infrastructure used for paying by credit/debit card. What changes, is the technology used by the person making the payment.

First, you need to have the right type of mobile phone. This must contain a Near Field Communication (NFC) chip and also a credit/debit card application which is normally stored safely inside the SIM card.

In order to pay, you wave the phone in front of a contactless reader in a shop or at a subway turnstile, for example. The NFC system allows wireless communication over distances of less than ten centimeters between the chip and the reader. Normally for low value payments e.g. less than 20 euros the payment will be authorized at this point, however for larger purchases you may be asked to enter your PIN code for extra security. This feature will depend on your bank or card issuer's rules.

See more about a recent French trial - http://www.payezmobile.com/uk-index.php