Page 15 - Advanced_Payments_Report_2014

ADVANCED PAYMENTS REPORT 2014 – SPONSORED BY

In addition to MNO-led initiatives, a few banks are expected Blue Tooth Low Energy (BLE) Beacons,
to launch programmes with embedded chips. In Australia, from Concept to Reality
Commonwealth Bank of Australia announced its launch of an NFC
Both Apple and PayPal are supporting BLE, the technology behind
mobile payment service with Samsung and MasterCard. Westpac,
their recently announced beacon products. Beacons are small, low
another leading Australian bank, is expected to launch a similar
cost devices that retailers (and others) can use to communicate
programme with Visa.
wirelessly between devices, such as a customer’s mobile phone, and
Google Wallet, which launched with Sprint in the US, has met can easily deploy in indoor locations.
stif resistance from the other leading MNOs who have efectively
Bluetooth connections can transmit messages, such as specifc deals
blocked access to their chipsets, severely limiting the success of its
or product information, to customers while tracking a customer’s
wallet.
location within the store at the same time. Compared to WiFi
Google’s support of HCE ofers a way around its problems with communications, beacons are far more precise in pinpointing
access to handsets and brings credibility to the possibility of cloud locations than WiFi’s geo-location capabilities.
based solutions for NFC. The recent launch of Royal Bank of Canada’s
Additionally, beacons use signifcantly less power and thus do not
mobile solution utilises similar technology.
drain precious battery life as quickly. Promoters of beacons foresee
Available in Blackberry for several years, HCE enables storage of payment applications that deliver on frictionless payments by
the payment credentials remotely combined with NFC for the fnal automatically checking a customer out as they leave the store with
communications to the POS terminal. Hybrid solutions like this have merchandise in hand, without the customer having to stand in line
the promise of simplifying the mobile payments ecosystem. at a physical check out. Customers must authorise applications, thus

In recent years, the market has seen progress in establishing the providing permission, in order to activate the technology.
infrastructure required for NFC solutions with growing deployment The technology is currently being tested at Apple stores and selected
of contactless terminals in various markets such as the United merchants. BLE may have signifcant potential but it remains to be seen
Kingdom, Canada, Australia and Turkey. how it will be implemented and how consumers will respond in order
Additionally, the availability of NFC enabled handsets is increasing. to assess its real potential.
However, the complexity of the value chain and its implications
on the business model remains unresolved. Using hybrid models,
the ecosystem can be simplifed – a service provider can store the
payment credentials in the cloud, bypassing the need for a Secure
Element in either the SIM or an embedded chip in the phone. This
has obvious economic advantages for the service provider.
Many experts express security concerns around a software only
solution for mobile payments, including HCE. A possible solution
could be coupling HCE with a Trusted Execution Environment
(TEE) which efectively provides a frewalled section of the mobile
operating system to ofer secure storage and controlled access to
data stored in that environment.

www.edgardunn.com | www.paymentscardsandmobile.com Edgar, Dunn & Company in association with Payments Cards and Mobile 15