Boston, MA
October 2004

RFID, EPC and Self-Checkout Solutions: Payments Beyond the Barcode

While not directly impacting stakeholders in consumer payment technologies immediately, the arrival of the Electronic Product Code (EPC) will be a profoundly disruptive technological leap, especially when RFID technology is cheap enough for inclusion in all consumer goods.  With the electronification of payments coupled with increasing automation of the retail experience, there are going to be some exciting developments at the checkout.

Nick Holland, Director of the Emerging Technologies Advisory Service and co-author of the report sees the advantages of self-checkout and EPC going beyond just simplifying the way we pay…

“Currently, there is little opportunity for engaging in real-time loyalty marketing targeted directly at the shopper as they roam the aisles.  With developments in EPC tagging and mobile self-checkout systems, a whole new model of one-to-one marketing arises…”

Hypothetical Multi-Merchant Loyalty Network
One of Eight Exhibits included in this report

Hightlights of the report include…

  • A comparison of UPC codes (barcodes) and EPC (RFID) tages including an in depth explanation of the Electronic Product Code including the tags, the readers and the underlying software architecture, as well as details of the Wal-Mart mandate and a predicted deployment timeline for key merchant segments

  • Analysis of the strengths and weaknesses of two types of self-checkout solutions using best-in-class vendor offerings from NCR and Cuesol as examples

  • Discussion on the repercussions of EPC enabled self-checkouts for stakeholders (merchants, hardware vendors, issuers, card associations, acquirers and processors) including a model for a merchant loyalty consortium

  • Critical analysis of present day barriers to acceptance

While ubiquitous EPC tagging is still a decade or more off, Holland predicts it will not be a flash-in-the-pan:

“The EPC is so undeniably useful from a logistics tracking perspective that it cannot be neglected.  Over time the technology will reduce in cost and reasons for committing to EP solutions will become increasingly compelling.  It may seem premature to be considering the repercussions that could occur at the checkout due to EPC tags, but certainly the technology will not be going away.”

The report contains 8 exhibits and is 23 pages.

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