What is NFC and How Does It Work? (Answered)

What is NFC and How Does It Work?
What is NFC and How Does It Work?

NFC is rapidly becoming more widely used with the increased use of technology in our daily lives. NFC provides many benefits for both individuals and businesses when it comes to data transmission.

NFC stands for Near Field Communication and is a technology that allows devices to communicate with one another without having to use multiple steps to configure a connection or facilitate physical contact between two devices. NFC technologies have been widely used throughout Asia and Europe with a recent increase in NFC use in the United States.

NFC provides wireless communication interoperability between devices using methods which are established with specific Near Field Communication standards. The standards are enforced by the NFC Forum which was established in 2004 by Nokia, Philips, and Sony. The standards include Bluetooth and FeliCa which is a standard that provides contactless communications using Integrated Circuit (IC) Card or Smart Card technology.

The NFC standards provide guidelines for manufacturers to follow to ensure devices equipped with Near Field Communications are compatible and easy to use with different types of technology. It also helps to increase wireless communications security and compatibility, especially when transmitting payment data using different methods of transmission associated with NFC technologies.

Near Field Communication utilizes radio frequencies to communicate with other NFC enabled devices. The radio frequency is transmitted between devices using a technology known as an interrogator or reader which creates the frequency to allow your device to communicate with another device equipped with NFC capability.

The device can be any type of mobile device such as a smartphone or tablet PC, digital signage, electronic advertising posters, product information devices within a store setting, payment terminals, and much more. NFC is often part of P2P (Peer to Peer) communication using two devices that are NFC enabled which allows both devices to exchange data with one another.

How NFC Works

If you are unsure of what NFC entails, the technology is a derivative of RFID or Radio Frequency Identification. RFID is a commonly used wireless communication technology that transfers data using electromagnetic fields and is frequently embedded into products such as passports, inventory tracking technologies, tollbooths, credit cards, information technology, and much more.

The main difference between RFID and NFC is that Near Field Communication allows devices that are within a close distance of one another to communicate using one of three forms of NFC technology including FeliCa, Type A, and Type B. All of these technologies function in a similar way but are slightly different with FeliCa commonly used in Japan.

Near Field Communication enabled devices can be one way or two way. A one way device will contain an NFC tag which includes data and information that can be read by other NFC enabled devices. However, a one way NFC device is unable to read any information from other NFC devices.

Two way devices that have NFC technology installed can transmit information, as well as read information from other NFC enabled devices. In other words, a device such as a smartphone can gather information from an NFC tag in a one way device plus, it can exchange information with other two way NFC enabled devices.

Near Field Communication technology utilizes encryption to enhance security and transmits information using a secure channel. This is important when sending and receiving sensitive data such as credit card numbers during transactions. Additionally, if your device is NFC enabled, it is a good idea to use complex passwords that are difficult to guess and install antivirus software on your device.

Here is an informative video that provides you with a visual representation of how NFC works.


As we mentioned earlier, NFC is a consequence of RFID and has a shorter range for communications than RFID technology and ensures better security. NFC transpired as a result of the NFC Forum whose main goal is to set standards for security, as well as educate individuals and businesses in an effort to increase the popularity of NFC. This means that any device equipped with NFC must be in compliance with the standards set forth by the NFC Forum. It also ensures that any device can communicate with another NFC device or a one way device equipped with an NFC tag.

Although the NFC Forum was established in 2004, Near Field Communication standards did not begin to be developed until two years later when the NFC Forum set the standards for NFC tags. The tags are small and contain information that can be read by any NFC enabled device. NFC tags can be placed in a sticker such as those that can be read by a barcode scanner or, an informational poster that dispenses information whenever you pass an NFC enabled device over it.

The informational posters are also known as smart posters and have gradually been increasing in popularity. You may have encountered this type of technology in public venues such as museums where you can learn more about a work of art, marketplaces where you can retrieve more information on a specific product, and other locations.

Nokia produced the first NFC enabled phone which enabled users to share data. Android soon followed with the inception of the Nexus S. From there, Near Field Communication technologies grew in popularity throughout Japan, Europe, and Asia with increased use in the United States as a means for transaction processing and data exchange.

NFC Uses

The main reason for the increased use of Near Field Communication is convenience and ease of use. This has required the NFC Forum to continually develop standards as plans for future NFC technologies expand to new areas. In the near future, you can expect to see more Near Field Communication technologies used in public venues such as shopping centers, malls, transportation hubs, professional buildings, and much more. Additionally, some of the automobile manufacturers are installing NFC technology to offer more services to automobile owners.

Although the possibilities for NFC are endless, here are a few of the most common uses for Near Field Communication that are currently being deployed:

Office and Professional Buildings: Employees use Near Field Communication to gain access to their place of employment. Access is easily obtained simply by swiping your mobile device across an entry system that contains an NFC tag. Also, many time clocks are equipped with the same technology for clocking in and out, in addition to vending machines in the break area.

Transportation: If you commute on the train or on a bus, all you have to do is pass your NFC enabled mobile device at the gate terminals to board the train or bus. Plus, many transportation hubs have kiosks that allow you to get updated information on any delays. You may also notice that there are interactive advertisements that allow you to gather information on your mobile device regarding area events or marketing promotions.

Shopping: NFC technologies are frequently used in stores to eliminate long lines and provide customers with information on specific products. When you pay for your items, you can simply pass your smartphone across the terminal without having to open your wallet and pull out your checkbook or credit cards. Many stores also preinstall reward points and coupons which are automatically applied to your purchase when you pay for your items at the register.

Concerts and Sporting Events: Near Field Communication technologies are being widely implemented in arenas and allow you to easily gain access to an event. Most of the arenas also use smart posters that allow you to swipe your smartphone to learn more about the performer or sports team, as well as gain access to a schedule of upcoming performances and events. You can also use NFC technology to make food purchases at the arena without having to search in your pockets for your wallet.

Sharing: Near Field Communication technology is frequently used to share information with your friends simply by tapping your devices together. This allows you to share a variety of data, links, and games, as well as send money to your friends by simply swiping your mobile devices together.

Healthcare: By using Near Field Communication technologies, healthcare professionals can be more accurate when serving patients, especially if you are working in a large hospital. NFC makes dispensing medications and conducting diagnostic tests more efficient. It also helps medical professionals to keep track of patient treatments simply by swiping a mobile device over a reader that is equipped with NFC and designed to record the information and input it into the system. This reduces hassles associated with lost paperwork, inaccurate record keeping, and other complications.

As you can see, the possibilities are endless when it comes to using Near Field Communication technology. We have only mentioned a few ways NFC can make life easier. Below you will find an interesting video on how Near Field Communication is transforming the automobile industry with technologies that make your traveling experience easier and a lot more pleasant.

NFC Security Concerns

Most of the first time users of Near Field Communication technologies are concerned about security when it comes to making payments and making sure your credit card data is secure. This is understandable if you have never used the technology and are concerned about the safety of your personal and financial information.

The following information will provide you with some of the possible security risks along with some of the ways Near Field Communication technology works to protect you from a security breach.

Data Corruption Attacks

Cyber criminals that perpetrate data manipulation attacks use methods that intercept the information that is being transmitted to an NFC reader. Criminals interfere with the data in an effort to render it useless when it is received by the reader.

To avoid problems with data manipulation and corruption, Near Field Communication uses secure channels and encryption to transmit data to the reader. In most cases, the NFC technology also includes listening capability that monitors communications for data manipulation and corruption attacks. This prevents the attack from occurring before it has a chance to intercept and corrupt the data.

Data Interception

Data interception between two Near Field Communication devices happens when the cybercriminal intercepts the data being transmitted. Once interception takes place, the information is modified as it is transmitted between two NFC devices. This act can be carried out by a sophisticated criminal that has a thorough understanding of Near Field Communication technology. This typically is less common than other types of security breaches.

To prevent data interception from occurring, most NFC enabled mobile devices can be configured to be one way or two way. If you have one device configured as one way or passive, and another as two way or active, this makes data interception a lot more difficult while increasing the security of data transmission.


Eavesdropping is just as the name implies and happens when the criminal eavesdrops and listens in on data transmission in progress between two Near Field Communication enabled devices. Instead of corrupting the information, the criminal picks up specific signals in an effort to steal your personal or financial information.

Eavesdropping can be prevented using secure and encrypted channels for data transmission. Additionally, NFC devices must be close together to communicate with one another which means the criminal has less time to intercept the signal. This means you should always make sure the manufacturer of your mobile device utilizes secure channels for transmitting data using NFC.

Device Theft

If your NFC device is stolen, this means that the criminal can make purchases with your device simply by swiping it over a payment terminal. For this reason, you should use passwords that are difficult to guess and change your password frequently. You can also obtain technology that locks the screen when your device is powered on. This prevents the thief from determining your password and accessing any sensitive information on your mobile device.

Although it may appear like Near Field Communication technology may increase security risks, in many ways it is safer than using your credit card in the traditional manner. If you lose your card, the information can be read by the person who finds it. If a cashier sees your credit card information, they can steal your personal information and use the card to make unauthorized purchases.

When you use Near Field communication technology to perform a transaction, your credit card never comes out of your wallet and no one else, including the cashier, can view your financial information. Plus, if you have the property security steps in place such as password protection, a stolen phone will be useless to the criminal.

How NFC Compares to Alternative Technologies

As you are learning more about Near Field Communication, you may be wondering how it compares to similar alternative technologies such as QR codes or Bluetooth. These are other forms of contactless communication which can be used to transmit data between two devices.

QR Codes

QR codes are the more modern form of barcodes and allow you to use your mobile device to scan the QR code. You can find QR codes on products, advertisements, on pages in publications, and just about anywhere that you can swipe your smartphone to gain access to further information. Your mobile devices interprets the QR code to provide you with specific information on a product or service.

QR codes are very similar to Near Field Communication technology since there is no contact between the code and your device. The code contains an NFC chip that can be read by your mobile device. The QR code stays the same where NFC is capable of easily modifying the data.

NFC offers more security while QR codes can be read by a broader range of devices. If businesses use QR codes to generate promotions, a computer program is used to create the image for printing on a promotion or advertisement.

If the business wants to change the offer, they must generate another QR code and then reprint it for use in the advertisement. This is not the case with NFC which allows you to easily modify the promotion without using the steps involved with generating another QR code.


NFC and Bluetooth are both forms of wireless communications and facilitate data transmission over short distances. The main difference between NFC and Bluetooth is NFC transmits data over a range of just a few centimeters where a Bluetooth connection can cover as much as 25 feet or more.

Near Field Communication technology consumes less power than Bluetooth. Additionally, the close distance for data transmission eliminates communication issues in crowded areas where many users are using their devices simultaneously. If you are using Bluetooth, the communication can be easily disrupted via other devices in your surroundings that are trying to communicate as well.

Phones without NFC Capability

If you are interested in using Near Field Communication capabilities with an existing or older device, you can enable your device without having to invest in a new one. This is accomplished via a SIM (Subscriber Identity Module) card or an SD card that is equipped with an NFC chip.

SIM Cards

SIM cards that are equipped with NFC chips are becoming more widely used and are on their way to becoming a global standard. They are also more accessible than SD cards equipped with Near Field Communication technology. Although this may pose a security risk, many SIM card manufacturers are developing security technologies that make the use of an NFC enabled SIM card safer.

SD Cards

An SD card is a small device that increases the memory and storage on a mobile device. SD cards can be obtained with NFC technology built into it. This allows you to easily connect it to your mobile device and begin swiping your device over terminals and smart posters.

It is important to mention if you choose an SD card with NFC technology, there are only a small number of mobile devices that are compatible with this technology. If your smartphone is equipped with a metal SD card slot, an SD card with NFC technology will not work properly due to the metal material. A device that does not have a metal SD card slot will accept an SD card with Near Field Communication technology.

How to Use an NFC Enabled SIM or SD Card

Once you have obtained an SIM or SD card that is enabled with Near Field Communication technology, power down you mobile device, connect the card, and then power up your device again. Then look for apps that are compatible with Near Field Communication technology and will allow you to easily read smart posters and other devices enabled with NFC.


NFC has been molding the future of how we make retail purchases and go about our daily lives. NFC terminals have been popping up everywhere including on street advertisements, in transportation hubs, store windows for after hour purchases, and many other locations. NFC is built upon the growing popularity of mobile wallets and mobile payments.

Recently, Apple fueled the use of NFC technology with the introduction of the iPhone 6 equipped with NFC and Apple Pay. The company partnered with several major banks to implement Apple Pay which can be used at participating retailers such as Staples, Walgreens, and variety of other stores. Where NFC will take us in the near future remains to be seen however, it is evident that NFC technology is industry changing and has the potential to go as far as our imagination will take it.

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