How Does an NFC Chip Work?

Contactless payments made through applications like Google Pay, Samsung Pay, and Apple Pay on smartphones have become popular. Holding a phone close to a payment reader enables users to swiftly make transactions. 

But how do these contactless payments work?

A Guide to NFC Chips

NFC (Near-Field Communication) is an evolution of the Radio Frequency Identification technology or RFID. It is a wireless standard that allows users to connect, send, and receive data with devices close to each other. The proximity is typically within three to four centimeters. 

Most smartphones may already have NFC chips equipped, and these chips work together with NFC tags. The NFC chip’s job is to analyze data before launching a predefined response. After analyzing the incoming data, it then instructs or writes data onto the NFC tag. 

RFID and NFC operate under inductive coupling, wherein a reader device produces a magnetic field by transmitting an electric current through a coil. This process eliminates the need for physical contact. Following the initial connection, any data on the tag is wirelessly sent to the receiver. 

Moreover, NFC provides better security than Bluetooth due to its shorter range. This makes it ideal for preventing signal interference, especially in busy locations wherein several devices are trying to connect. 

Common Uses and Benefits of NFC 

Aside from making contactless transactions, there are various uses of NFC. These include digital business NFC cards, instant Wi-Fi connectivity, and generating smart passports. 

NFC also has many advantages. The following are some of them:

  • An instant connection between devices is convenient for businesses and users. It allows them to share information within seconds seamlessly, and they do not need to carry anything else other than their smartphone. 
  • It is adaptable as it can be used in different situations. 
  • Because of its ability for contactless payments, NFC may be utilized as a transportation card for buses or trains. 


Learn more about NFC chips here!

NFC Tagify is a UK-based provider of NFC business solutions. They offer products like NFC chips, stickers, and business cards. Visit their website or contact them at +44 16 0080 0080 for more details. 


Joan Johnson

The author Joan Johnson