Apple has created a prototype of a payment terminal that small businesses, such as hairdressers and mom-and-pop stores, could use to scan NFC-enabled iPhones and iPads, Doherty said. The company is considering heavily subsidizing the terminal, or even giving it away to retailers, to encourage fast, nationwide adoption of NFC technology and rev up sales of NFC-enabled iPhones and iPads, he said.
"Near-field communication" is very similar to the technology used in gas station speed passes, highway toll tags, and ID badges like mine. It's already available in Google's latest Android phone, the Nexus S, and as the article says, a potentially huge cut of payment processing fees is at stake in the adoption of a new payment method.