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A different view of EMV opportunitiesState-of-the-art of multiapplication cards in the world
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EMV (Chip & PIN) EMV (Chip & PIN) perspectivesperspectives
October, 22nd 2008
A Chip is a Computer => able to offer various functionalities
Security (card-present and card-not-present environments)
Card authentication (digital signature, digital certificate)
⇒ Mitigate risks of counterfeiting card (through a data breach) and phishing (secure remote authentication for e-commerce & e-banking)
Cardholder authentication (off-line PIN)
=> Mitigate risks of fraud due to stolen/lost and not-received card
Value added application(s) can be added onto a chip card
e-purse (low value payment), e-ticket/e-fare (transit), e-coupon (loyalty program)
easy-to-use and convenient
Chip Chip capabilitiescapabilities
2Nathalie Caye - [email protected] - © e-excellence inc. 2008
Card-present transaction
Numeric signature and secrets
Encrypted PIN
Cash
Credit card
Card-not-present transaction
Digital certificate and secrets for
secure remote authentication Coupon ($)
Retailer loyalty
program
Bus fare
Offer new products and/or services
New cards with value-added services (multi-function
cards), self-service devices, PIN change service, etc.
Develop the acceptance network
PIN off-line functionality (debit and prepaid cards), new
channels of payment, partnerships
Reduce costs
Fraud, operational and processing costs
Provide a better customer service
Convenience, time savings
Enhance your public image
Innovation & Security
Profitable for all stakeholders
What kind of perspectives can we except with the What kind of perspectives can we except with the
chip & PIN card ?chip & PIN card ?
3Nathalie Caye - [email protected] - © e-excellence inc. 2008
Merchant Cardholder
Interchange
Network(s)
Terminal
Debit/Credit/
Prepaid cards
Processor
IssuerAcquirer
ATM
Processor
Context:
Economic situation
Fraud issues
Consumers needs
New consumer habits
Demo: chip and PIN card transaction in a restaurantDemo: chip and PIN card transaction in a restaurant
4
Cardholder
Terminal
Chip & PIN cardWELCOME
ENTER AMOUNT
16.08 $ Ok?
WAITING FOR CARD
INSERT OR SWIPE
PROCESSING
DO NOT REMOVE CARD
ADD TIPS ? YES ->
NO ->
Merchant
Check card digital signature
(Static or dynamic card
authentication)
AMOUNT ->
% ->
2.00 $
Nathalie Caye - [email protected] - © e-excellence inc. 2008
Demo: chip and PIN card transaction in a restaurantDemo: chip and PIN card transaction in a restaurant
5Nathalie Caye - [email protected] - © e-excellence inc. 2008
ENTER PIN
PRESS OK
****
DO NOT REMOVE CARD
GIVE TERMINAL TO CLERK
APPROVED
REMOVE CARD
Cardholder
Chip & PIN card
Merchant
Terminal
Process online/offline authorization
(eventually dynamic card
authentication)
Check PIN (Cardholder authentication)
Print cardholder and merchant
receipts
Generate a dynamic digital
certification
Store the transaction into the
chip application
Trends in terms of value added chip cardsTrends in terms of value added chip cards
6
Europe
e-fare (transport)
Low-value payment
Secure Remote authentication
Prepaid card
Offline PIN Debit card
Combination of a Debit and a Credit
application on the same chip card
Canada
Low-value payment
Offline PIN Debit card
First adopters: mature payment market
implementing value added services card
Payment markets implementing
only chip payment cardValue added chip application depends on:
Culture of payment
Maturity of payment market
Level of confidence in forms of payment
Kiok
Mexico – Brazil
Offline PIN Credit card
Transport (unbanked
population in Brazil)
Wireless
terminals
Russia
Welfare services
Asia Pacific
e-coupon (Instant reward)
e-purse
e-fare (transport)
e-ID
Travel ticket
vending machine
Nathalie Caye - [email protected] - © e-excellence inc. 2008
Conclusion: shortConclusion: short--termterm, , midmid--termterm and long and long termterm
perspectivesperspectives
Nathalie Caye - [email protected] - © e-excellence inc.
20087
Issuer Cardholder Merchant Acquirer/Processor
/ISO
ATM/ABM
Processor
PIN
(off-line
auth)
�Fraud mitigation (C,
S/L, MNR)
�New card products
offering a larger
acceptance network (off-
line PIN Debit card,
Prepaid card )
�Fast check-out
�Convenient and
easy-to-use (same
process for all chip
cards)
�Larger acceptance
network
�Fast check-out, time saving
�Convenient and easy-to-
use (same process for all chip
cards)
�New card acceptance
(offline PIN Debit card,
Prepaid card) ; Could
encourage higher spending
�New services (self-service
devices with higher floor
limit)
�Less paper (till rolls)
�Cost reduction
�New range of
terminals offering
(Wireless, self-service
devices, etc.)
�New merchants
�PIN Change services
(new revenues)
�Value-added
services at the ATM:
e-fare reloading (new
revenues)
New card
products
�Contact/Contactless
card (increase revenues
by replacing cash)
�Secure remote
authentication (e-
banking, e-commerce)
�Differentiation
�Replace cash for low
value payment
�Secure e-banking, e-
commerce (protection
against phishing )
�New card acceptance
(could encourage higher
spending)
�Increase revenues
(number of
transactions)
New
terminal
devices
�Increase revenues
(number of transactions)
�Larger acceptance
network and services
�Wireless terminal
(convenience)
�Self-service devices for high
amount purchase (kioks), for
items rental (DVD, bicycles,
trolleys, etc.)
�New merchants
�Increase revenues
(number of
transaction)
Misc. �Convergence and
Partnership (transport,
retailers)
�Mitigation of a part of
fraud due to data
breaches
�New services :
transport, loyalty and
reward program
(instant reward)
�Loyalty and reward
program
�Cost reduction
(private network)
�Loyalty and reward
program for
merchants
�Application
downloading service
�Partnerships
Sh
ort
-
term
Mid
an
d
lon
g -
term
Thank you for your attentionThank you for your attention
