In an effort to prevent card data pilferages by unscrupulous elements, private lender Axis Bank will be making 50,000 of its point of sales (POS) machines Near-Field Communication (NFC)-enabled by this year end, which will help users pay at stores without swiping cards or entering their PIN.
At NFC-enabled POS devices, a customer has to bring his card within a certain range of the machine and the debit happens from the linked accountautomatically.
"We believe that in order to make the contactless mode of payments a reality, we need changes in the ecosystem. One fifth of our POS machines will be enabled to accept payments under the new system," JairamSridharan,President, retail lending and payments, told PTI.
He said the bank, which is the second-largest POS acquirer after HDFC Bank, has already installed the technology in 100 places and will be scaling it up to 20,000 in the next two months.
Earlier this year, the RBI had come out with guidelines for the 'tap-and-go' payments and restricted the maximum amount per transaction to Rs 2,000 due to security concerns. The guidelines followed a heated debate on security versus convenience.
The country's largest lender by assets and third-largest POS acquirer, State Bank of India was the first to launch an NFC-enabled card, but the compatible POS machines are yet to come in, resulting in no such transactions.
Axis Bank had 2.45 lakh POS machines of the total network of 11.31 lakh in the country as of May-end of 2015.
During the rollout of the NFC-based POS machines, Sridharan said, the bank will prioritise establishments like fast food joints, pharmacies, coffee shops, in-campus eateries and neighbourhoodkirana shops.
The bank is also eyeing partnerships with taxi services as payment through the 'tap-and-go' method will be beneficial for the trade, he said.