Post Office could take snail mail contactless in 2012 with NFC POS terminals

The UK Post Office is considering whether or not to equip all 12,000 branches with contactless NFC POS terminals by October 2012. For those in other countries who are unaware of British Post Office, you should know that it always sits at the heart of every community, is very traditional and generally also sells a hodgepodge of stationary and provides services including foreign currency exchange, benefits payments and even provides insurance products and banking. Obviously postage and mailing packages is the core business of the Post Office, and it does this in collaboration with its sister service, the Royal Mail, which as part of the old public organization the General Post Office (GPO) acted as one service. It actually has an important place in British culture, often becoming a meeting point in many communities across the land. However, what is not usually associated with the Post Office is bleeding edge technology.

UK Post Office may deploy NFC POS terminals next year

UK Post Office set to potentially install 30,000 to 35,000 NFC POS terminals in 2012

With such a large scale deployment, this ambitious project will probably make the Post Office the single largest merchant in Britain to support NFC payments. The Post Office also plans on selling a pre-paid card that can be used to pay for any product or service that it offers.

UK Post Office could benefit from increased efficiency if it goes ahead with its proposed NFC POS terminal upgrades.

If the Post Office ultimately decides to take the NFC route, the new NFC POS terminals will reduce queuing times and allow the Post Office to be more efficient, and in many ways bring it up to date which it has sorely needed for many years. Michael Birchall, Payment Product Manager for the Post Office, sees the new NFC POS terminals cutting time stood in line by up to 60%. Considering that 60% of transactions are below £15 or approaching $25, the majority of customers could benefit from the new efficiency this upgrade could afford.

“As far as speed, someone doing a tap to buy postage is faster than handing over a £10 note or a chip-and-PIN transaction,” Birchall told NFC times.

Birchall added that the Post Office has to change its aging POS terminals and wants to be ready to accept contactless cards as banks roll out more contactless credit, debit and prepaid cards. What is unknown, however, is who would be in the running for the massive contract. Currently the Post Office uses terminals from U.S. company Hypercom, but that could be set to change if the new NFC POS terminals are approved. So far, there are around 15 million contactless bank cards on issue which can be used at 60,000 contactless POS terminals installed at merchant locations in the UK. Both of these figures are expected to grow substantially this next year so it makes sense that the Post Office would consider supporting NFC in its branches country wide.

Many citizens in the UK are considered underbanked and prepaid cards are increasingly used, but NFC could also be used to service the 3.5 million benefit cards on issue for pension, unemployment and other government benefits. If the Post Office embraces NFC, then maybe other old country wide organizations will feel compelled and we may see NFC POS terminals at the Co-op.