NFC Basic Concepts

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The Basic Concepts of NFC
and it’s future within Mobile Commerce
Author: Ade Okuboyejo

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NFC Technology
 Near Field Communication (NFC) is a
standards-based short-range wireless
connectivity technology for electronic
devices
 A set of standards
 Range typically up to 10cm
 Frequency 13.56 MHz
 Data rates 106,212,424 kbits
 No battery required

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NFC Uses

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NFC Tag Types/modes of operation
 Active mode of communication: In the active
NFC mode of communication, both devices generate an
RF signal on which the data is carried
 Passive mode of communication: In this
mode of communication, only one NFC device
generates an RF field. The second passive device
which is the target uses a technique called load
modulation to transfer data back to the primary device
or initiator
 Tag Types:There are several tags specified by NFC
forum (Type 1,2,3,4) and each type of cards are
suitable for specific task depending on the use case.
Type A and B are both based on 13.56MHz but the
difference concerns modulation methods

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NFC Communication modes
 Attach an NFC module to the device
 peer-to-peer mode : Use the NFC device to interact with another
NFC device
 e.g. Phone to phone transactions
 reader / writer mode : Use the NFC device to read / write external
tags
 e.g.Mobile as a POS terminal
 card emulation mode : Use the NFC device as a tag for external
readers
 e.g. Mobile as a payment card

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Mobile as a payment card, why?
 Plastic card
 Secure element + NFC link
 NFC enabled module
 Secure Element (SIM/UICC card)
 Co-operating application processor and a
(G)UI
 OTA (Over The Air) channel

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Mobile NFC payment actors
 Basically a marriage between banks, MNOs & SPs
 Several banks and MNOs exist in a given market
 A facilitator will simplify the relationships
 TSM (trusted service manager)

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TSM
Acts as a bridge between SP’s, MNO’s and the final customer, providing trusted
services securely over the mobile network. A TSM can also be applicable to non-
NFC provisioning

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Secure Elements
Host Card Emulation (HCE), which enables NFC payments and other secure services to be
delivered without the use of a physical secure element is also an option

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TSM Types
SEI TSM manages Secure Element(SE) lifecycles and Secure Domain(SD) for
Service Providers(SP) e.g. Partitioning securely SE memory into separate
domains for SP’s
SP TSM manages the service provider application provisioning to the SE and its
application lifecycle

11. TSM Certification
Payment schemes such as Visa and MasterCard require stringent certification
criteria
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 Secure key storage
 Secure physical premises
 High quality processes
 Security built in deployed solutions
To manage end-2-end security, a key ceremony takes place between:
1. Banks & TSM
2. MNO’s & TSM
The TSM is then able to unlock the SE and establish an encrypted link between the SE and the TSM server

12. Mobile NFC payments architecture
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NFC Standards
 ISO 14443 (Contactless Integrated circuit cards, proximity cards)
 Standardises physical characteristics, radio interface, initialization/anti-collision & transmission
protocols
 Type A & B depending on radio interface
 ISO/IEC 15693 (Contactless Integrated circuit cards, vicinity cards )
 RFID item tracking
 ISO/IEC 18092 or ECMA 340 (Near Field Communication interface and protocol, NFCIP-1)
 Standardises RF field/signal interface, initialization/anti-collision & transmission protocols
 Active and passive RF modes, peer-to-peer mode
 Several data rates
 ECMA 352 or ISO 21481 (NFCIP-2)
 Specifies operating mode selection (ISO 14443, 15693, NFCIP-1)
NFC Module
NFC Reader

14. NFC module
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UICC
UICC-NFC module interface
 ETSI TS 102 613 : Single Wire Protocol (SWP)
 Implementations (mobile handset & UICC) are beginning to
emerge
 SWP specifies only hardware layer & an overlay software standard
is necessary
 ETSI TS 102 622 : UICC-Contactless Front-end interface, Host
Controller Interface (HCI)
 Provides a software (API) standard on top of SWP
 Implementations (mobile handset & UICC) are yet to emerge

15. Application processor – UICC interface
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Hardware/low level standards
 3GPP TS 11.11 SIM-ME interface/ETSI TS 102.221 UICC-Terminal Interface
 ISO 7816 based communication
 Serial,low speed (9600 bps)
 Physical (hardware) & Logical (API)
 Implementation widespread
 ETSI TS 102 600 Smart Cards : UICC-Terminal interface, Characteristic of
the USB interface
 Fresh specification
 Also known as high spec interface
 Speeds up to 12 Mbps
 Implementations yet to emerge
Appl. processor
UICC

16. Application processor – UICC interface
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Software/ high level standards
 3GPP TS 11.14 SIM application toolkit /ETSI TS 122.038 USIM application
toolkit/ETSI TS 102.223 (Card Application Toolkit)
 Enables UICC to take initiative (proactive)
 Implementations widespread but full implementation on the terminal side is rare
 Boring text based MMI
 JSR 177 Security and Trust services API for J2ME
 Initiative from application processor (Midlets)
 Implementations reasonably widespread
 OMA SmartCard Web Server (SCWS)
 Initiative from a browser on the phone
 Implementation is not widespread
 Rich graphical MMI is possible
Appl. processor
UICC

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Application processor – NFC
Module interface
 No widely agreed hardware standard (12C, USB etc)
 Probably not so important for service providers since the terminal
manufacturer integrates NFC module in the mobile
 NFC Forum’s work on NCI (NFC Controller Interface)
 Standardisation of APIs for this interface
 Ongoing work
 JSR 257 Contactless communication API for J2ME
 Specifies high level APIs for this interface
 Nokia has already implemented it on 6131_NFC
Appl. processor
NFC module

18. OTA Server
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OTA Standards/Technologies
 GlobalPlatform
 Initiative from the financial industry
 Security domain creation and manipulation on the UICC
 Secure channel protocols (SCP)
 Commands for Secure application download/install/delete/lock etc
 3GPP TS 03.48/ETSI TS 102.225/226
UICC
 Remote APDU structure for UICC based applications (push data directly to the
UICC from a remote server)
 Aligned with GlobalPlatform commands
 Midlet proxy method
 Use a midlet in the mobile to proxy communication between the server and the
UICC

19. Testing, security, NFC devices, Interfaces, Digital,
Compliance program, Payment, Retail, Transport
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NFC Forum
 Committees
Marketing, Compliance, Technical
 Working Group
 Task Force Architecture, Test tool, RF testing. Air transport,
Tags & Formats, Wireless charging

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NFC Forum standards
 NFC Data Exchange Format (NDEF)
 The basic format (bit level) in which data are stored in NFC tags (or
devices).
 Record Type Definition (RTD) specification
 High level definition of different types of NDEF records (ie information
and action)
 Text, URI, Smart Poster
 Tag type technical specification
 Tags are categorized into four main groups.

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mCommerce
mCommerce is essentially electronic commerce over wireless devices. It helps
to connect merchants and consumers via smartphone using technologies such
as NFC and QR codes
3 types of mCommerce transaction are:
• Carrier based transaction
• Use of credit card over a wireless network
• Financial services
Benefits of mCommerce are:
1. Increase sales and customer loyalty
2. Reach target market in real-time via ad
Partnership/Alliances
•.Common Mobile Marketing Platform (includes Weve, Isis, WyWallet)
•.Global Ticketing Interoperability

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mCommerce Automated Work Flow
Key actors
• Consumers
• Companies (manufacturers, retailers etc)
• MNO’s and SP’s
• Enablers and Regulators
Inventory update
Account update
Shipping details
shipping label
Payment gateway transfers
the fund to the merchant’s
bank account
The online store transmits
the formatted order from the
web host to the payment
gateway
Online buyer purchases a
product at merchant site
Consumer’s information is
encrypted while being
transferred over the internet
The payment gateway
continues processing the
transaction, it then transmits
a request for the card to be
changed to MEPS for
validation
Transaction confirmation.
Shipping and tracking information
PRODUCT RECEIVED

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mWallet
Is the graphic user interface used to control the card applications stored on a
handset. A kind of electronic purse
Issuers of mWallet can benefit from:
• Increased revenue through new value added
services
• Multiple branding possibilities
• Enhanced brand stickiness
• Market reach to new segments
• Harness NFC opportunities
End-users of mWallet can benefit from:
• Ease of use and convenience
• Flexibility
• Specialised offers
• Ubiquity
• Security and Confidence
• Person 2 Person money transfer
• International remittances

24. Google Wallet is a mobile payment system developed by Google that allows its
users to store debit cards, credit cards, loyalty cards, and gift cards among other
things
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Google Wallet
• Enable secure payments to be made
using NFC
• The new Android 4.4 introduces HCE
• Possibility exists to sidestep SE and
TSM
• Softens the influence of telco-run NFC
schemes such as Isis in dictating the
direction NFC takes

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NFC, hype or reality
 NFC handsets
 Few models already in market
 Motorola, LG, RIM etc have
announced commitment to NFC
 500 million units by 2015
 Cost coming down as the volume
grows
 NFC tags
 List price of NFC tags is as low as
$0.16

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Revenue Stream

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Future of NFC
 Mobile NFC opens up new opportunities in payment, banking, airline
ticketing, online shopping and transport
 Most of the crucial standards are already in place, but implementation
are not sufficiently widespread
 The rollout of SCWS would provide a new environment in which to
develop, execute and distribute content rich applications from the SIM
thereby complementing NFC
 Mobile NFC is now finding it’s uses in phone to phone data exchange,
ticketing and payment. This will continue to grow as more NFC
handsets are available and interoperability issues are addressed

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Difficulties
 Lack/cost of NFC mobile phones
 Compatibility with existing contactless infrastructure
 Cost of high memory, multi-application UICC cards
 Existing proprietary implementations (Mifare, FeliCa) does not
fully comply with existing contactless standards

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Thank you!

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Glossary
OMA Open Mobile Alliance
USIM Universal SIM
USAT USIM Application Toolkit
BIP Bearer Independent Protocol
3GPP 3rd Generation Partnership Project
ETSI European Telecommunication Standards Institute
TSM Trusted Service Manager
HCE Host Card Emulation