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PayPal enables cash-by-slap

iPhones that go bump in the night

Designing a Defense for Mobile Applications

The latest version of PayPal's iPhone application allows users to transfer money by bumping their handsets together, putting one more nail into the NFC coffin.

PayPal's application allows those with an account to reimburse each other for a split bill, collect money for a leaving present or donate money to charity on a whim. But it's the incorporation of Bump Technologies' client that permits the transfer of funds to a complete stranger by tapping phones together.

The technology is used to identify two partners in the transaction - the exact time, the rough location, the force of the bump as measured by the accelerometer in the handsets. These, combined with various other clues, are used to identity the two parties involved, who can then request or hand over cash after entering a PIN.

Any confusion requires a repeated clarifying bump, and with both parties authorising the payment manually the security risks are minimal.

As such we're not going to see Bump replacing the mass-transit applications for proximity payments - just take a moment to imagine all that splintered plastic as commuters slap their iPhones against the tube gates - but it could enable small and informal transactions. The likes of market stalls and creches don't always take credit cards, so there's an opening here.

It's also an area where proximity payment systems, such as those espoused by the NFC Forum, have hoped to find a home on the basis that two people equipped with NFC phones would be able to do much the same thing. NFC World reckons that PayPal has enough presence to eat away at that potential, especially if the capability spreads beyond the iPhone. ®

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