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For the system, NTT adopted public-key cryptography technology, a two-key system that encrypts data using a public key and decrypts it using a secret key.
This is the first use of public-key cryptography on a contactless IC card, according to Yuji Ikeda, a spokesman for NTT.
A contactless IC card includes a small chip and antenna so that it needs only to be brought close to a sensor and not inserted into a slot like many current IC card systems.
The overall time to process a payment has been cut to 250 milliseconds through advances in the read/write equipment, and by using recognition algorithms that can pre-process information, NTT said.
The card is primarily being aimed at public transport payment systems, where fast processing times are important. The company has also developed a system that allows the cards' stored value to be replenished using public telephones. NTT has 42,200 public telephones across Japan that operate with an earlier contactless IC telephone card.
However, Ikeda said NTT has yet to decide when to make the system available to a wider commercial market.
IC cards are regarded as one of the potential media for e-commerce. Several companies in Japan have recently adopted payment systems using contactless IC cards.
East Japan Railway, one of Japan's major railway operators, started a service on 18 November that allows passengers to go through a ticket gate with a contactless IC card. A larger group of companies, led by Sony, is also developing the Edy contactless IC, and some convenience stores have begun accepting the cards.